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1. If a nation has an open economy, it means that the nation:
A) Allows private ownership of capital
B) Has flexible exchange rates
C) Has fixed exchange rates
D) Conducts trade with other countries
2. In Adam Smith's trade model, labor is the only factor of production and the labor theory of value is the basis for cost. According to Smith's trade model in a two-nation, two-product world, a country has an absolute advantage in a product if the country
A) uses the same about of labor to produce the product as the other country
B) uses less labor to produce the product than the other country
C) uses more labor to produce the product than the other country
In a price-fixing agreement amongst two oligopolists, each seller's best strategy would be to maintain the agreement, as it would leave both of them better off. The smaller th
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A franchise restaurant chain is considering a new store in an unserved part of town. Its finance group estimates NPV of $10 million if the population growth is 10% (40% prob
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