If a Country Has a Trade Surplus Then

question 60

Multiple Choice

If a country has a trade surplus then

• A)S > I and Y > C + I + G.
• B)S > I and Y < C + I + G.
• C)S < I and Y > C + I + G.
• D)S < I and Y < C + I + G.

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Definitions:

Game Theory

A theoretical framework for conceiving social situations among competing players and predicting their choices of action through mathematical models.

Oligopolists

Companies or entities that are part of an oligopoly, a market structure characterized by a small number of firms controlling a large market share, often leading to less competitive markets.

Pricing Behavior

The strategies and practices employed by sellers in setting and adjusting prices of goods and services.

Kinked-Demand Curve

A demand curve that has a flatter slope above the current price than below the current price. Applies to a noncollusive oligopoly firm if its rivals will match any price decrease but ignore any price increase.