Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

If we were looking at a small country that was dependent upon natural resources extraction and other similar capital investments, then a shift in the

If we were looking at a small country that was dependent upon natural resources extraction and other similar capital investments, then a shift in the supply, those natural resource outputs, would likely drive the economy more than consumer demand changes. (the situation in New Caledonia resembles this situation). Even when we look at China versus USA there are substantive differences in what drives the economic. What percent of consumer spending is the GDP? It is much greater in the US versus China and thus we would say that changes in demand curves drive the economy more in US than in China

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image_2

Step: 3

blur-text-image_3

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

International Economics Theory and Policy

Authors: Paul R. Krugman, Maurice Obstfeld, Marc J. Melitz

9th Edition

978-0132146654, 0132146657, 9780273754091, 978-0273754206

More Books

Students also viewed these Economics questions