Lack of Evidence of a Pattern of International Consumption Smoothing

question 4

Multiple Choice

Lack of evidence of a pattern of international consumption smoothing is best explained by

• A) government policies to fight trade deficits.
• B) failure of consumers in less advanced economies to act rational.
• C) a tendency for business cycles to be a worldwide phenomenon.
• D) Ricardian equivalence.
• E) very different levels of aggregate economic activity.

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Definitions:

Special Fees

Additional charges that may be applied for specific services, facilities, or considerations, beyond the base cost of a product or service.

Surcharges

Surcharges are additional fees or charges added to the cost of a good or service, often to cover increases in operational costs or to provide additional services.

Reciprocity Agreement

An agreement between two parties to provide similar benefits or services to each other, often found in trade and partnership contexts.

List Price

The suggested retail price set by a manufacturer or retailer for a product, often not reflecting discounts or promotions.