Biology Forums - Study Force

Most Mexican workers can increase their wages if they migrate to the United States, a demand-pull factor for migration.
 
  Indicate whether the statement is true or false

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Question 2 - If a firm's output more than doubles when all inputs are doubled, production is said to occur under conditions of
 
  A) increasing returns to scale.
  B) imperfect competition.
  C) intra-industry equilibrium.
  D) constant returns to scale
  E) decreasing returns to scale.

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Question 3 - Based on the theory of comparative advantage, nations maximize their well being when they
 
  A) create more jobs.
  B) allocate resources more efficiently.
  C) increase trade surpluses.
  D) increase exports.

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Question 4 - What is the difference between endogenous and exogenous variables? In the equilibrium condition of PPP, which variables are endogenous and which are exogenous?
 
  What will be an ideal response?

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Question 5 - An improvement in a country's balance of payments means a decrease in its balance of payments deficit, or an increase in its surplus. In fact we know that a surplus in a balance of payments
 
  A) is always beneficial.
  B) is usually beneficial.
  C) is never harmful.
  D) is sometimes harmful.
  E) is always harmful.

[ 1 ]  TRUE

[ 2 ]  A

[ 3 ]  B

[ 4 ]  Endogenous variables are considered within a model, while exogenous variables are not directly considered within the model, and are thus taken as given. The difference between these kinds of variables is not related to their nature, but rather on the focus that the researcher has at the time. For example, the weather may be an exogenous variable in a model to determine crop yield, but an endogenous variable in a model that looks at the climate change effects of carbon emissions.

In the theory of PPP all variables are considered to be endogenous, that is, both price levels and the exchange rates are considered to be affected by a multitude of exogenous variables which we are not considering, and yet they are bound by the equilibrium condition that PPP represents.

[ 5 ]  D

Thank you for answering correctly!