Global Economic Challenges

Trans-Pacific Partnership (TPP)

Led to helping protect human rights, giving Asia-Pacific producers larger markets, and boosting American exports.

Ways to control pollution

Legislative standard, pollution tax, pollution permits

Aquifers

underground water-bearing rock formation

Concerns for developing countries

Humanitarian, economic, political, and gap between industrialized and developing countries.

Acid Rain

A mixture of water and sulfur dioxide that makes a mild form of sulfuric acid EPA pollution permits target coal-burning electric utilities to reduce emissions

Businesses

Impacted through increased competition in globalization.

Labor

Impacted through increased job opportunities in globalization.

4 major nonrenewable energy resources

1. oil 2. natural gas 3. coal 4. nuclear energy

5 guidelines for economic decision making by the National Council on Economic Education -

1. state the problem or issue 2. determine the personal or broad social goals to be attained. 3. consider the principal alternative means of achieving the goals 4. select the economic concepts needed to understand the problem and use them to appraise the merits of each alternative 5. decide which alternative best leads to the attainment of the most goals or the most important goals

reasoned approach to economic decision making

1. state the problem or issue 2. determine the personal or broad social goals to be attained. 3. consider the principal alternative means of achieving the goals 4. select the economic concepts needed to understand the problem and use them to appraise the merits of each alternative 5. decide which alternative best leads to the attainment of the most goals or the most important goals set forth by National Council on Economic Education

Rate of population growth per year

1.7%

Example of tariff

A 1% tax on all imported steel

European Union (EU)

A European economic union that supports their economies by using a common currency called the euro.

Example of embargo

A ban on goods being imported from Cuba

Developing country

A country whose average per capita GNP is a fraction of that in more industrialized countries.

Example of quota

A limit of 10 tons of sugar can be imported

Quota

A limit placed on the quantities of a product that can be imported

price system

A mechanism that uses the forces of supply and demand to create an equilibrium through rising and falling prices.

Embargo

A restriction on the export or import of a commodity in trade

World Bank

A specialized agency of the United Nations that makes loans to countries for economic development, trade promotion, and debt consolidation.

Tariff

A tax on imported goods

Protective Tariff

A tax on imported goods that is intended to protect a nation's businesses from foreign competition

Revenue Tariff

A tax on imports for the purpose of raising money

How has globalization made countries more interdependent? Check all that apply. a. Countries now rely on one another for vital resources. b. Countries now rely on each other for new industries. c. Countries now rely on one another for chances to import. d. Countries now rely on one another for an employment base. e. Countries rely on each other for cheaper products. f. Countries now rely on one another for chances to export.

ALL

Location of most developing countries

Africa, Asia, and Latin America

Thomas Malthus (1766-1834)

English economist; In 1798 he wrote An Essay on the Principle of Population; pessimist views on population growth vs resources

High Development

Final stage of economic development, in which efforts to obtain food, shelter and clothing are more than successful.

Primitive Equilibrium

First stage of economic development, in which society has no formal organization.

Semi-development

Fourth stage of economic development, in which core of a country's industry is built; national income grows faster than population

Organization of the Petroleum Exporting Countries (OPEC)

Group that holds influence over global politics due to control of oil reserves.

Consumers

Have a wider choice of products through globalization.

Economic Globalization Benefits

Include access to larger markets and increased production of goods.

Economic Globalization Disadvantage

Include loss of jobs in developed countries through outsourcing and depletion of natural resources.

Cost-Benefit Analysis

Involves comparing the costs of an action to its benefits - also referred to as marginal analysis allows logical economic decisions

General Agreement on Tariffs and Trade (GATT)

Laid the groundwork for the World Trade Organization.

Scarcity

Limited quantities of resources to meet unlimited wants

As of 2013, which of these countries had the highest GDP per capita? a. Uganda b. the United States c. Switzerland d. Brazil

NOT b. the United States

Capital Flight Obstacle

Obstacle to development because of a cash shortage and places a limit on the amount of capital investment that can occur

Government Obstacle

Obstacle to development because of frequent changes in government and risk of violent revolution

Natural Resources Obstacle

Obstacle to development because of lack of natural resources in a developing country.

Education and Technology Obstacle

Obstacle to development because of low literacy rates and lack of resources to provide education.

Foreign Debt Obstacle

Obstacle to development because of the large amount of external debt and the struggle of developing countries to even pay interest on their debt.

Population Obstacle

Obstacle to development because of the tendency of developing countries to have much faster population growth.

Middle East oil crisis

Oct. 1973 (eve of Yom Kippur) Egypt and Syria attack Israel; America sends aid to Israel-> Arabs cut off oil shipments to U.S. •oil prices soar •1974, embargo is lifted, but Arab nations now know that restricting oil raises the price

Nonrenewable Energy Sources

Oil, natural gas, and coal

Effect of low prices

People use more of a resource; use of the resource is not careful.

Thomas Malthus Arguments

Population would grow more quickly than its ability to feed itself (exponential growth vs. constant growth).

What are the most likely reasons a US corporation would open a factory in China? Check all that apply. a. to take advantage of affordable land prices b. to take advantage of abundant resources c. to take advantage of lower labor costs d. to take advantage of favorable tax laws e. to take advantage of employment opportunities

Potentially all

pollution control

Prevention Dispersion (dilution) Collection and disposal Chemical change (combustion) through laws that set standards, taxes on pollution released

Problem of a trade deficit

Reduces the value of a country's currency on the foreign exchange market.

Break with Primitive Equilibrium

Second stage of economic development, usually results from an outside force showing a different, more attractive way of life.

Renewable Energy Sources

Solar, hydroelectric, wind, nuclear

absolute advantage

The ability of a country to produce a good or service at a lower cost than another country

comparative advantage

The ability of a country to produce a good or service at a lower opportunity cost than another country

National Defense

The argument for protection based on a country not becoming too specialized.

Infant Industry

The argument for protection based on protecting new industries.

Protecting Domestic Jobs

The argument for protection based on providing domestic jobs and protecting against sources of cheap foreign labor.

Balance of Payments Argument

The argument for protection based on the idea that it's harmful to have a trade deficit.

Keep the Money at Home

The argument for protection based on the idea that it's more beneficial for American dollars to stay in America.

Pollution

The contamination of air, water, or soil by the discharge of a poisonous or noxious substance.

Specialization

The key to trade

Capital Flight

The legal or illegal export of a nation's currency and foreign exchange

Foreign Exchange Rate

The price of one country's currency in terms of another country's currency

coal reserves

The quantities of discovered, but not yet mined, coal in sedimentary rock of the continents.

system of pollution permits

The system of tradable pollution permits is a remarkably simple way to regulate pollution at a cost that is optimal to society. ... With free trade, the permits become an asset- firms who pollute too much can buy additional permits to cover their emissions at a price that reflects the marginal social cost of the pollution.

Weak dollar

The value of the dollar is less than that of other countries; foreign goods are more expensive.

Strong dollar

The value of the dollar is more than that of other countries; foreign goods are less expensive.

Take-off

Third stage of economic development; economy grows more rapidly, but still lacks maturity.

North American Free Trade Agreement (NAFTA)

Trade organization that includes Canada, Mexico, and the United States.

Example of foreign exchange rate

US dollars to British pounds

Modified Free Enterprise Economy

a free enterprise economy with some government involvement advantages: ability to adjust to change gradually wo need for government intervention

Gasohol

a fuel that is a mixture of 90 percent unleaded gasoline and 10 percent ethanol

economic forecast

a prediction, based upon past observations and current trends, of what will happen in an economy in the future

Which statements accurately describe a country's currency? Select all that apply. a. The currency is easily divisible. b. The currency can be used in any other country. c. The currency has a value that can change. d. The currency has denominations. e. The currency has a value that must stay the same.

a, d and e

Which situation is the best example of opportunity cost? a. A country chooses to produce bananas instead of wheat. b. A country chooses to invest in manufacturing and agriculture. c. A country chooses to specialize in producing paper products. d. A country chooses to export all of its products.

a. A country chooses to produce bananas instead of wheat.

Which describes the difference between a trade surplus and a trade deficit? a. A trade surplus is when a country exports more than it imports, while a trade deficit happens when imports exceed exports. b. A trade surplus is when a country imports more than it exports, while a trade deficit happens when exports exceed imports. c. A trade surplus is when a country produces more than it consumes, while a trade deficit happens when consumption exceeds production. d. A trade deficit is when a country loses money on products it makes, while a trade surplus happens when production leads to profits.

a. A trade surplus is when a country exports more than it imports, while a trade deficit happens when imports exceed exports.

Which statements best explain how globalization offers an advantage to businesses? Check all that apply. a. Businesses can take advantage of favorable laws to make products cheaply. b. Businesses can take advantage of favorable taxes to make products cheaply. c. Businesses can take advantage of new forms of technology to make products cheaply. d. Businesses can take advantage of new forms of democracy to make products cheaply. e. Businesses can take advantage of faster technology to make products faster.

a. Businesses can take advantage of favorable laws to make products cheaply. b. Businesses can take advantage of favorable taxes to make products cheaply. c. Businesses can take advantage of new forms of technology to make products cheaply. e. Businesses can take advantage of faster technology to make products faster.

Why might developed economies want to outsource manufacturing and other jobs to developing economies? a. Developed economies can find more inexpensive labor in developing economies. b. Developed economies are responsible for helping developing economies progress. c. Developed economies focus only on service, not manufacturing, so they must outsource. d. Developing economies produce higher-quality goods, so it makes sense to outsource.

a. Developed economies can find more inexpensive labor in developing economies.

Why do developing countries usually have less variety in their economic activities? a. Limited access to education means that people are not trained to work in industry or technology. b. Focusing on one or two economic activities leads to more rapid economic development. c. Developing countries are usually small and have limited populations and resources. d. People prefer the lifestyle that accompanies traditional activities such as farming.

a. Limited access to education means that people are not trained to work in industry or technology.

Which best describes how standards help domestic producers? a. Standards require goods to meet basic requirements. b. Standards provide financial support for producers. c. Standards restrict the import of cheap goods. d. Standards offer incentives to ensure high quality.

a. Standards require goods to meet basic requirements.

The map shows the world's gross domestic product. Graph Title -- Gross Domestic Product (PPP), 2011 Based on the map, which is the best conclusion that can be drawn about the economies of the US and China? a. The US and China are strong because they have a high gross domestic product. b. The US and China are weak because they have a low gross domestic product. c. The US and China are strong because they have a low gross domestic product. d. The US and China are weak because they have a high gross domestic product.

a. The US and China are strong because they have a high gross domestic product.

Which statement accurately describes a developing country? a. The country's population has a high growth rate. b. The country has a high standard of living. c. The country's population has a high life expectancy. d. The country has a high GDP per capita.

a. The country's population has a high growth rate.

Which is the best example of a country that is dependent on other countries? a. a country that has little fertile soil b. a country that has no imports c. a country with grain surpluses d. a country with a diverse economy

a. a country that has little fertile soil.

One sign of transition to a mixed-market economy is the establishment of a. a fair labor market. b. anti-poverty regulations. c. state-owned business. d. a smaller middle class.

a. a fair labor market.

How do embargoes most negatively affect a domestic market? a. by depriving domestic producers of needed goods, restricting their ability to trade b. by helping international producers fill a market void, decreasing domestic trade c. by preventing domestic producers from trading needed goods with all countries d. by encouraging international producers to sell new goods for lower prices than domestic goods

a. by depriving domestic producers of needed goods, restricting their ability to trade

How have airplanes changed the way the world does business? Check all that apply. a. by making long trips less expensive b. by making long trips in less time c. by opening up new trade markets d. by increasing hiring opportunities e. by increasing travel options

a. by making long trips less expensive b. by making long trips in less time c. by opening up new trade markets e. by increasing travel options

Which technologies have made global communication instant and more effective? Check all that apply. a. cell phones b. wireless devices c. smart phones d. automobiles e. newspapers

a. cell phones b. wireless devices c. smart phones

One primary purpose of the European Union is to a. create a common market. b. eliminate borders between countries. c. allow highly skilled workers to be employed. d. establish a free trade zone in the marketplace.

a. create a common market.

Trade agreements can cause jobs to go to countries that provide those jobs a. efficiently. b. expensively. c. freely. d. gradually.

a. efficiently.

A factory owner might decide to manufacture shirts in Pakistan instead of the United States because a. it is less expensive to make shirts there. b. it is worth paying more for foreign labor. c. workers in Pakistan are more skilled. d. workers in Pakistan work fewer hours.

a. it is less expensive to make shirts there.

Global trade provides consumers with a. more options and lower prices. b. fewer options and lower prices. c. more options and higher prices. d. fewer options and higher prices.

a. more options and lower prices.

The graph below shows the value of the US dollar versus the Canadian dollar. Graph Title -- Value of the US Dollar vs. Canadian Dollar For the time period shown, the value of the US dollar was generally a. rising against the Canadian dollar. b. falling against the Canadian dollar. c. more than twice that of the Canadian dollar. d. about half that of the Canadian dollar.

a. rising against the Canadian dollar.

A tariff is a type of a. tax. b. punishment. c. subsidy. d. grant.

a. tax.

Trade agreements are helpful because they allow countries to a. trade for necessary goods. b. increase trade tax revenue. c. influence foreign trade. d. help create new trade barriers.

a. trade for necessary goods

Capitalism

an economic and political system in which a country's trade and industry are controlled by private owners for profit, rather than by the state dominant economic force in the world has adaptability and evolved modified by its people to satisfy the economic goals of freedom, efficiency, equity, security, full employment, price stability and economic growth

marginal analysis

analysis that involves comparing marginal benefits and marginal costs essentially the same as cost-benefit analysis

The United States is said to have an absolute advantage in producing food compared with Japan. What does that mean? a. It must import most of its food from Japan. b. It produces food more efficiently than Japan. c. It produces food at a higher cost than Japan. d. It must export most of its food to Japan.

b. It produces food more efficiently than Japan.

The chart below shows an exchange rate table. Currency Exchange Rate April 3, 2013 (Euro = 1) -------------------------------- Bulgarian lev 1.96 Canadian dollar 1.301 Swiss franc 1.2149 British pound 0.8482 Japanese yen 119.4065 US dollar 1.2839 What is the most likely conclusion that can be drawn about how this table would look in December 2013? a. It would look the same because exchange rate tables do not change. b. It would look different because exchange rate tables change constantly. c. It would look different because exchange rate tables change once a month. d. It would look different because more countries will have started to use euros.

b. It would look different because exchange rate tables change constantly.

How can a nation benefit from effectively exporting its goods? a. Its citizens can buy cheaper goods. b. Its businesses can invest in the future. c. Its domestic spending increases. d. Its citizens have more money.

b. Its businesses can invest in the future.

It takes brothers John and Dan the same amount of time to clean the room they share, but John can mow the lawn faster than Dan. Which action would allow them to take advantage of their respective comparative advantages? a. them both sharing each task equally b. John mowing the lawn and Dan cleaning their room c. Dan mowing the lawn and John cleaning their room d. Dan doing both tasks

b. John mowing the lawn and Dan cleaning their room.

Read this excerpt describing the mission of the World Bank. The World Bank is a vital source of financial and technical assistance to developing countries around the world. It is not a bank in the common sense. Instead, it plays a different but supportive role in its mission of global poverty reduction and the improvement of living standards. It provides low-interest loans, interest-free credit, and grants to developing countries for education, health, infrastructure, communications, and many other purposes. According to this excerpt, what is one major way in which the World Bank differs from a regular bank? a. The World Bank is a source of financial assistance. b. The World Bank aims to improve living standards. c. The World Bank provides low-interest loans and credit. d. The World Bank serves people of different income levels.

b. The World Bank aims to improve living standards.

The graph shows gross domestic product in the US private sector from 2009 to 2011. Graph Title -- Annual Growth in US Private-Sector GDP What conclusion can be drawn about the US economy? a. The economy suffered a setback in 2009 before rebounding in 2011. b. The economy suffered a setback in 2009 before rebounding in 2010. c. The economy suffered a setback in 2009 and had not recovered by 2011. d. The economy suffered setbacks in 2009, 2010, and 2011.

b. The economy suffered a setback in 2009 before rebounding in 2010.

The chart shows a circular flow model describing the movement of goods and services. CHART How does globalization cause the foreign sector to influence the economy? a. The foreign sector influences how services move between firms and households. b. The foreign sector influences how imports and exports move between firms and households. c. The foreign sector influences how factors of production move between firms and households. d. The foreign sector influences how goods move between firms and households.

b. The foreign sector influences how imports and exports move between firms and households.

The chart below shows an exchange rate table. Currency Exchange Rate March 12, 2013 (US dollar = 1) ---------------------------------- Canadian dollar 1.0278 Swiss franc 0.9508 Euro 0.7689 British pound 0.6706 Japanese yen 96.1503 Which statement accurately interprets the information on the chart? a. Japan's currency shows that it has the strongest economy of any country. b. The value of each currency is shown in relation to the US dollar. c. It would take six British pounds to purchase one US dollar. d. Swiss francs are the strongest currency in Europe.

b. The value of each currency is shown in relation to the US dollar.

Which statement best describes how globalization is affecting the world? a. Globalization is growing less important as time passes. b. The world is becoming more globalized and connected. c. Globalization has resulted in fewer connections among countries. d. Countries are growing less likely to trade with one another.

b. The world is becoming more globalized and connected.

Which best describes the effect negative incentives have on a certain course of action? a. They make the action impossible. b. They make the action less profitable. c. They make the action difficult. d. They make the action less likely.

b. They make the action less profitable.

Which best describes ASEAN? a. an international organization promoting free trade b. a regional organization promoting growth in Southeast Asia c. an international organization trying to establish a common currency d. a regional organization establishing free trade between Canada and Mexico

b. a regional organization promoting growth in Southeast Asia

The Free Trade Agreement Tariff Tool allows US businesses to a. request that tariffs be limited. b. access tariff rates when planning to export. c. know which countries are entering trade associations. d. access new trade agreements as they are developed.

b. access tariff rates when planning to export.

The best time for Americans to import French cheese is when they can a. exchange a combination of goods and US dollars for euros. b. buy the most euros for US dollars. c. buy the most US dollars for euros. d. exchange US dollars for pesos and then for euros.

b. buy the most euros for US dollars.

Globalization is the process of a. limiting exchange of goods and services. b. connecting the world over time. c. requiring or relying on something. d. focusing on certain goods and services.

b. connecting the world over time.

Who decides which currency each country in the world uses? a. the United Nations b. each individual country c. the European Union d. the United States

b. each individual country.

Technologies that allow for instant worldwide communication include a. high-speed trains and naval ships. b. mobile phones and Internet access. c. airplanes and container shipping. d. outsourcing and new trade markets

b. mobile phones and Internet access.

A reason that countries trade with each other is a. to help their neighbors. b. to get products they cannot produce. c. to sell goods they do not need. d. to share excess resources.

b. to get products they cannot produce.

What is the government's aim in setting quotas? a. to create more competition in the market b. to increase sales of domestic goods c. to keep tariffs high d. to limit export of domestic goods

b. to increase sales of domestic goods

An Essay on the Principle of Population

book: Thomas Malthus; argued that population tended to increase more rapidly than food supply population grows geometrically - 2, 4, 8, 16 ...whereas ability of the earth to feed is constant 1, 2, 3, 4, ... led to theory of subsistence thought only war, famine and disease could check population growth. later added moral restraint what he missed: didn't foresee the advances in productivity; also didn't foresee families have less children or population declining

Which group works to help members establish internal political stability? a. European Union b. World Trade Organization c. Association of Southeast Asian Nations d. North American Free Trade Agreements

c. Association of Southeast Asian Nations

Which of these statements most accurately describes the use of currencies in different parts of the world? a. Most countries use the dollar as their currency. b. Countries in Asia use the euro as their currency. c. Different countries use different currencies. d. All countries are required to use the same currency.

c. Different countries use different currencies.

What did President Ronald Reagan believe about economic growth? a. Increased trade barriers would help the economy. b. Free trade associations would limit competition. c. Increased production and fair trade would help the economy. d. Trade barriers would help make trade more fair between countries.

c. Increased production and fair trade would help the economy.

What role does competition play in international trade? a. It results in higher prices. b. It discourages imports. c. It drives down prices for consumers. d. It does away with the need for investment.

c. It drives down prices for consumers.

Why does an increase in literacy rates often accompany an increase in per capita income? a. People who have higher-paying jobs often have the time available to develop literacy skills. b. Developing countries have higher-than-average literacy rates, which typically leads to higher income. c. People who can read and who receive an education are eligible for higher-paying jobs. d. Developed countries often attempt to raise low literacy rates to improve income.

c. People who can read and who receive an education are eligible for higher-paying jobs.

The graph shows US trade with China from 1985 to 2012. Graph Title -- US Trade with China (1985-2012) What conclusion can be drawn about trade between the United States and China? a. The United States has a trade surplus with China. b. China's economy is declining. c. The United States has a trade deficit with China. d. China's economy is improving.

c. The United States has a trade deficit with China.

What do quotas and embargoes have in common? a. They both tend to raise prices. b. They both affect imports from certain countries. c. They both set limits on imported goods. d. They both frequently result in domestic shortages.

c. They both set limits on imported goods.

Countries establish internal economic zones in order to a. limit foreign investment. b. make solving disputes easier. c. have fewer economic restrictions. d. create manageable amounts of imports.

c. have fewer economic restrictions.

One factor that indicates a developed economy's standard of living is its a. growth in outsourcing rates. b. strong social connections. c. high levels of education. d. low GDP per capita.

c. high levels of education.

Read this news report about a planned devaluation of the bolivar, the currency of Venezuela. The president of Venezuela announced that the country would be devaluating the bolivar for the fifth time in nine years. The official rate is falling from 4.3 bolivars to the dollar, to 6.3, a 32% devaluation. By increasing the bolivar value of exports of oil to the US and other nations, the government hopes to alleviate a budget crisis caused by its increasing reliance on borrowing to meet spending obligations. In response to the announcement, the people of Venezuela lined up today to buy televisions, electronics, and airline tickets in order to protect themselves from projected price increases. By devaluating the bolivar, the president of Venezuela has a. followed the law of supply and demand. b. allowed the exchange rate to remain unchanged. c. increased the number of bolivars needed to buy one dollar. d. decreased the number of bolivars needed to buy one dollar.

c. increased the number of bolivars needed to buy one dollar.

International trade organizations promote free trade by encouraging countries to a. maintain their tariffs. b. establish their trade quotas. c. limit their protectionism policies. d. develop their products.

c. limit their protectionism policies.

An economic incentive is best described as something that a. benefits producers or consumers when taking action. b. pushes producers or consumers to act on the government's behalf. c. motivates producers or consumers to take action. d. forces producers or consumers to act in a certain way.

c. motivates producers or consumers to take action.

Which group directly benefits from subsidies? a. exporters b. sellers c. producers d. importers

c. producers.

Which factor plays a role in establishing the value of a country's currency? a. the attractiveness of the currency design b. the location of the country c. supply and demand d. distance between countries

c. supply and demand

What is the purpose of quotas? a. to ban all imports from a country b. to ensure specific goods are not available to consumers c. to limit how much of a good can be imported d. to keep prices on domestic goods low

c. to limit how much of a good can be imported

What is the benefit in reaching the absolute advantage in the production of one good? a. to produce more units of a good than other countries b. to produce fewer units of a good than other countries c. to produce more units of a good while using fewer resources d. to produce fewer units of a good while using fewer resources

c. to produce more units of a good while using fewer resources.

In a transitional economy, a ____________ economy is changing to a mixed-market economy.

command

Why are environmental problems common in developing countries? a. The citizens of developing countries have not been educated about the dangers of pollution and the need to protect resources. b. People in developing countries travel long distances by car to get to work and school, leading to air pollution and habitat destruction. c. Rapid growth of new industries and technology has led to an enormous increase in environmental woes in developing countries. d. Developing countries often specialize in manufacturing and providing raw materials, which can seriously harm the environment.

d. Developing countries often specialize in manufacturing and providing raw materials, which can seriously harm the environment.

Which of these statements most accurately describes currencies in North America? a.All countries in North America use the US dollar. b. All countries in North America use the euro. c. North American countries have done away with separate currencies. d. Each country in North America uses its own currency.

d. Each country in North America uses its own currency.

What does the International Monetary Fund (IMF) seek to accomplish for developing countries? a. The IMF establishes industries and technologies in developing countries. b. The IMF helps a developing country's citizens establish bank accounts. c. The IMF gives college aid to qualified individuals in developing countries. d. The IMF provides economic advice and loans to developing countries.

d. The IMF provides economic advice and loans to developing countries.

What kind of advantage does a country have if it can make a product more inexpensively? a. an import advantage. b. an export advantage. c. a comparative advantage. d. an absolute advantage.

d. an absolute advantage.

Why does the US import oil? a. because it does not produce any oil b. because it has exported too little oil c. because it has exported too much oil d. because it does not produce enough oil

d. because it does not produce enough oil.

If the value of the US dollar declines in relation to other currencies, goods imported into the United States will a. not be allowed to enter the country. b. become less expensive. c. remain the same in price. d. become more expensive.

d. become more expensive.

In developed economies, less-educated workers a. have more jobs to choose from. b. are often more highly skilled than other workers. c. may be outsourced to other nations. d. can have difficulty finding work.

d. can have difficulty finding work.

Purchasing power parity is used to compare the gross domestic product between a. businesses. b. consumers. c. stock markets. d. countries.

d. countries.

Tariffs and subsidies are both types of a. restrictions. b. economic benefits. c. economic penalties. d. incentives.

d. incentives.

Often duties and taxes are imposed on cars that are imported from other countries. What types of incentives are these duties and taxes? a. positive incentive and subsidy. b. negative incentive and subsidy. c. positive incentive and tariff. d. negative incentive and tariff.

d. negative incentive and tariff.

What type of economic growth do most developed economies experience? a. rapid growth b. unpredictable growth c. moderate growth d. slow growth

d. slow growth

If investors can earn 10 percent interest in an account in Mexico but just 3 percent in the United States, those investors will most likely a. continue to invest in the United States and have no effect on the exchange rate. b. want to invest in Mexico and cause the exchange rate to rise. c. try to do anything possible to keep the exchange rate from changing. d. want to invest in Mexico, which will cause the peso to appreciate.

d. wanted to invest in Mexico and cause the exchange rate to rise.

Which situation might cause a country to specialize? a. bananas grown far from major transportation b. seafood in an area with few fishing vessels c. electronics in a city with few trained workers d. wheat production in a region with fertile soil

d. wheat production in a region with fertile soil

where are the most rapid rates of population growth

developing nations

____________ is the process of an economy's increasing industrialization, standard of living, and economic wealth.

development

Pollution Permits

federal permits allowing public utilities to release specific amounts of emissions into the air Issuance began in 1993 with additional issuance in successive years - sold on Chicago board of Trade - bought in one ton increments - fewer permits are supposed to be sold as time goes on making them more scarce and expensive to discourage pollution - environmentalists actually purchased many of the permits to limit supply push up cost to polluting companies to discourage pollution

Which type of goods becomes more expensive as a result of tariffs?

imported

dominant economic force

measure of the strength of a brand, product, service, or firm, relative to competitive offerings

Which type of incentive makes it more profitable to follow a certain course of action?

positive

Nonrenewable Resources

resources that cannot be replenished once they are used major nonrenewable resource category - fossil fuels: 1. oil; 2. natural gas; nearly 25% of energy consumption 3. coal - 2/3 world's known coal in US, Russia, China 4. nuclear energy - 8% of energy used in US continued use uncertain due to cost - reactors are expensive to build and maintain and nuclear energy produces highly hazardous byproducts which the safe disposal is problematic; failure of a nuclear plant is catastrophic (Three Mile Island, PA in 1979 a near meltdown and Chernobly, Ukraine (Russia) meltdown in 1986) all used for energy, gasoline

Fundamental economic problem

scarcity

renewable energy sources

sources of energy able to be replaced through ongoing natural processes hydroelectric power, biomass, solar energy, wind power

Glut

substantial oversupply of a product

Bioinvasion

the intentional or accidental introduction of plant, animal, insect, and other species in regions where they are not native so have no natural predators and can decimate the existing environment

pollution

the presence in or introduction into the environment of a substance or thing that has harmful or poisonous effects.

Subsistence

the state in which a population produces only enough to support itself