Since World War II, the relative importance of raw materials, including oil, in total world trade
A) remained constant.
B) increased.
C) decreased.
D) fluctuated widely with no clear trend
E) increased slightly before dropping off.
Question 2 - If output is increased in the long-run, average production costs in the presence of internal diseconomies of scale will ________, and in the presence of external diseconomies of scale, will ________.
A) decrease; decrease
B) increase; remain constant
C) remain constant; increase
D) decrease; remain constant
E) increase; decrease
Question 3 - If the price of a good rises by 10 and the quantity purchased falls by 5, then demand for the good is ________ and total spending on the good will ________.
A) elastic; increase
B) inelastic; increase
C) elastic; decrease
D) me and so inelastic; decrease
Question 4 - The ratio of the percentage change in consumption of a good divided by the percentage change in income (as measured by GDP) is known as the
A) income elasticity of demand.
B) income expansion path.
C) demand elasticity equivalent.
D) trade effectiveness.
Question 5 - The HO model rules out the classical model's basis for trade by assuming that ________ is (are) identical between countries.
A) factor endowments
B) factor intensities
C) technology
D) opportunity costs
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