Answer:
If an economist argues that everyone gains from trade, the following reasoning is most likely underlying her argument:
- Production according to the principle of comparative advantage lowers overall costs and therefore allows both countries to have a higher standard of living.
Explanation:
- The comparative advantage refer to the situation in which an individual, company or a country offers its services and products at a lower rate as compared to its competitor. This leads to trade-off as you have to comprise for the gain of something.
- This comparative advantage also increase the dependencies of nations or companies on each other.
- For example, England and Portugal has benefited from this comparative advantage concept as England get the wine at lower cost from Portugal and Portugal also get earning by selling this wine to England.
Answer: $460 billion, but the effect would be larger if there were an investment accelerator.
Explanation:
If the MPC = 0.75 and there is no investment accelerator or crowding out, then a $115 billion increase in the government expenditures would result in the shift in the aggregate demand curve right by:
= $115 billion ÷ (1 - 0.75)
= $115 billion ÷ 0.25
= $115 billion × 1/0.25
= $115 billion / 0.25
= $460 billion.
Therefore, there'll be a shift in the aggregate demand curve right by $460 billion, but the effect would be larger if there were an investment accelerator
<span>Price transparency. This best describes the amount of truth or transparency about something. Complete information doesn't necessary represent somebody's understanding of something, but rather describes if all parts of said information were present to seen, heard, felt..etc.</span>
Answer:
The main reasons for policy intervention by the government are:
To correct for market failures.
To achieve a more equitable distribution of income and wealth.
To improve the performance of the economy.
Explanation:
To correct for market failures: This is achieve by creating regulation institutions for the most important sectors in any given economy e.g. Federal Reserve, Treasury Department
To achieve a more equitable distribution of income and wealth: This is the aim of a develop economy to allocate the resources where needed and for that some countries rely in the government capability to prevent Monopoly creation or to protect its Internal Labor market.
To improve the performance of the economy.: In order to meet the economical agenda of any given government the institutions use variation on the interest rate, the government expenditure or the tax policies.
