Supply-Side Policies & Sources of Comparative Advantage Mcqs
MCQ: According to supply-side economists, as tax rates are reduced, labor supply should increase. This implies that ?
- there is no income effect when tax rates are changed
- the income effect of a wage change is greater than the substitution effect of a wage change.
- there is no substitution effect when tax rates are changed
- the substitution effect of a wage change is greater than the income effect of a wage change
Releted Questions
Supply-Side Policies & Sources of Comparative Advantage Mcqs
MCQ: The Heckscher-Ohlin theory explains comparative advantage as the result of differences in countries ?
- Economies of large-scale production
- Relative abundance of various resources
- Relative costs of labor
- Research and development expenditures
B
MCQ: Boeing aircraft company was able to over its production costs of the first – jumbo jetll in the seventies because Boeing could market it to several foreign airlines in addition to domestic airlines. This illustrates ?
- How economies of scale make possible a larger variety of products in international trade
- A transfer of wealth from domestic consumer to domestic producer as the result of trade
- How a natural monopoly is forced to behave more competitively with international trade
- How a natural monopoly is forced to behave less competitively with international trade
A
MCQ: The theory of overlapping demand predicts that trade in manufactured goods is unimportant for countries with very different ?
- Tastes and preferences
- Expectations of future interest rate levels
- Per-capita income levels
- Labor productivities
C
MCQ: According to the factor endowment model of Heckscher and Ohlin, countries heavily endowed with land will ?
- Devote excessive amounts of resources to agricultural production
- Devote insufficient amounts of resources to agricultural production
- Export products that are land-intensive
- Import products that are land-intensive
C
MCQ: According to the trade theory of Staffan Linder trade tends to be most pronounced in manufactured goods when trading countries have ?
- similar endowments of natural resources
- similar levels of technology
- similar per-capita incomes
- similar wage levels
C