The New Trade Theorists Argue That in Those Industries Where

question 60

True/False

The new trade theorists argue that in those industries where the existence of substantial economies of scale imply that the world market will profitable support only a few firms,countries may export certain products simply because they have a firm that was an early entrant into that industry.

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Definitions:

Required Reserves

The portion of depositors' balances that banks must have on hand as cash or in reserves at a central bank, used as a measure to ensure liquidity.

Excess Reserves

Banks' reserves held at the central bank over and above the required minimum, which can influence the banks' ability to lend and thus affect the money supply.

Federal Reserve System

The central banking system of the United States, responsible for monetary policy, regulation of banks, and maintaining financial stability.

Federal Funds Rate

The interest rate at which depository institutions lend reserve balances to other depository institutions overnight, on an uncollateralized basis.