A.   greater competition

B.   specialization

C.   higher prices

D.   more variety of goods and services

A.   the government should focus on long term growth

B.   the government should focus on reducing the natural rate of unemployment

C.   the economy will fluctuate around its potential GDP

D.   the government should focus on reducing cyclical unemployment

A.   a decrease in interest rates

B.   a decrease in taxes

C.   a decrease in net exports

D.   an increase in government spending

A.   Indonesia has an absolute advantage in producing both fish and copper

B.   Malaysia has the comparative advantage in producing fish

C.   Indonesia has the comparative advantage in producing copper

D.   Malaysia has an absolute advantage in producing both fish and copper

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

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

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

A.   the government can make the economy recover faster

B.   fiscal policy is effective in fighting recessions

C.   the economy will adjust on its own

D.   the government works efficiently

A.   produce a good or service using more resources than another country

B.   produce a good or service using fewer resources than another country

C.   produce a good or service at a higher opportunity cost

D.   produce a good or service at a lower opportunity cost

A.   wages and prices are flexible

B.   the economy is past full employment

C.   the economy is at full employment

D.   wages and prices are sticky

A.   trade creates more jobs

B.   low income countries have high environmental standards

C.   they want nurture infant industries and protect them from foreign competition

D.   competition is beneficial

A.   1 box of cheese = 2 bottles of wine

B.   1 box of cheese = 5 bottles of wine

C.   1 box of cheese = 10 bottles of wine

D.   1 box of cheese = 4 bottles of wine

A.   the government is slow to detect a recession

B.   inflation is too high

C.   wages cannot adjust when the economy slows

D.   wages and prices are flexible

A.   the government can make the economy recover faster

B.   wages and prices adjust quickly

C.   people are well off and do not need assistance

D.   wages and prices are sticky

A.   to decrease domestic jobs

B.   to pay less for goods and services

C.   to protect domestic jobs

D.   to have a greater variety of goods and service

A.   rising

B.   high

C.   low

D.   the same

A.   France has the absolute advantage in producing cheese

B.   Italy has the comparative advantage in producing wine

C.   Italy has the comparative advantage in producing cheese

D.   Italy has the absolute advantage in producing wine

A.   a tariff lowers the world price of a good

B.   a tariff raises the world price of a good

C.   a tariff increases the amount of imports

D.   a tariff reduces tax revenue