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What are imports?
goods or services bought from a foreign country.
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What is a comparative advantage?
the ability of an individual or group to carry out an economic activity.
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What do tariffs and quotas do to the price of domestic products?
increases welfare of domestic producers and cause dead weight loss.
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What are some of the other barriers to trade?
Regulatory legislation and quotas, and inter-government.
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What are the beliefs of protectionists?
The Eight Dynamics of Existence.
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What are the beliefs of free traders?
that mankind was created by one God.
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What was the purpose of the WTO?
deals with the rules of trade between nations at a global or near-global level.
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What is the foreign exchange rate?
As of March 2009 it was 14.647.
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What determines the value of a country's currency?
trade, political stability, banking systems and interest rates, & manufacturing rates.
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What happens to American comsumers if the dollar fall in relation to foreign currencies?
imports cost more.
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What is the purpose of the flexible exchange rates?
that it allows the exchange rate to be determined by supply and demand.
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What are the characteristics of socialism?
government ownership of resources other than labor and centralized economic decision-making.
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How did Stalin impact the Soviet economy?
Stalin made it stagnant.
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What was perestroika?
the policy of economic and governmental reform instituted by Mikhail Gorbachev.
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What are the four problems an economy faces when changing from a command economy to a market economy?
disparity between rich and poor, increased corruption, shortages, and hoarding of money.
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What is capital-intensive?
A business process or an industry that requires large amounts of money and other financial resources to produce a good or service.
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What are the five stages of economic development?
1: Traditional Society, 2: Transitional Stage, 3: Take Off, 4: Drive to Maturity, 5: High Mass Consumption.
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What was the first commendation of the World Bank for both developing and industrialized nations?
manufacturers and factories.
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How are developing countries used by the United States?
US uses them through agreements that allow that country to sell their goods and improve their economy.
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Why are more developing nations successful at attracting foreign private investment?
Because they are increasing Capital.
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How can the amount of pollution be reduced under a system of pollution permits?
Having it handle the SO2 emissions reduction.
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When is a cost-benefit analysis useful?
useful for prediction and forecasting.
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What was the impact of high gas prices in the 1970s?
Costly federal taxes and regulations largely are to blame for high fuel prices.
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