Q1. Explain how it is possible for one of two people in a two-good economy to have an absolute advantage in producing both goods, but trade can still benefit both people.
Q2. Explain the various factors that weigh down consumer confidence in 2008
Q3. The government reduces the size of its deficit to zero.
At any given interest rate, consumers decide to save more. Assume the budget balance is zero at any given interest rate; businesses become very optimistic about the future profitability of investment spending. Assume the budget balance is zero.