Exam 4

A  a tariff increases the amount of imports

B  a tariff raises the world price of a good

C  a tariff lowers the world price of a good

D  a tariff reduces tax revenue

A  Italy has the absolute advantage in producing wine

B  Italy has the comparative advantage in producing cheese

C  Italy has the comparative advantage in producing wine

D  France has the absolute advantage in producing cheese

A  rising

B  low

C  the same

D  high

A  to protect domestic jobs

B  to have a greater variety of goods and service

C  to pay less for goods and services

D  to decrease domestic jobs

A  wages and prices are sticky

B  people are well off and do not need assistance

C  the government can make the economy recover faster

D  wages and prices adjust quickly

A  wages cannot adjust when the economy slows

B  wages and prices are flexible

C  the government is slow to detect a recession

D  inflation is too high

A  1 box of cheese = 4 bottles of wine

B  1 box of cheese = 2 bottles of wine

C  1 box of cheese = 5 bottles of wine

D  1 box of cheese = 10 bottles of wine

A  competition is beneficial

B  trade creates more jobs

C  low income countries have high environmental standards

D  they want nurture infant industries and protect them from foreign competition

A  the economy is at full employment

B  wages and prices are sticky

C  wages and prices are flexible

D  the economy is past full employment

A  produce a good or service at a higher opportunity cost

B  produce a good or service using more resources than another country

C  produce a good or service at a lower opportunity cost

D  produce a good or service using fewer resources than another country

A  fiscal policy is effective in fighting recessions

B  the government can make the economy recover faster

C  the economy will adjust on its own

D  the government works efficiently

A  an initial increase in spending, cycles repeatedly through the economy and has a smaller impact than the initial dollar amount spent

B  an initial increase in spending, cycles repeatedly through the economy and has a larger impact than the initial dollar amount spent

C  an initial decrease in spending, cycles repeatedly through the economy and has a larger impact than the initial dollar amount spent

D  an initial increase in spending,  has no impact on the economy

A  Malaysia has an absolute advantage in producing both fish and copper

B  Indonesia has the comparative advantage in producing copper

C  Indonesia has an absolute advantage in producing both fish and copper

D  Malaysia has the comparative advantage in producing fish

A  a decrease in net exports

B  an increase in government spending

C  a decrease in interest rates

D  a decrease in taxes

A  the government should focus on reducing the natural rate of unemployment

B  the government should focus on reducing cyclical unemployment

C  the government should focus on long term growth

D  the economy will fluctuate around its potential GDP

A  higher prices

B  specialization

C  greater competition

D  more variety of goods and services