Explanation​:
Import  expenditure = quantity  of  imports ×world  price  per  unit

Imports = 70−20

$(70million-20million)\times$ $=$ $\text{\$}$150 million

Option A multiplies the world price per unit ($\text{\$}$3) with the domestic supply (20 million)
Option C multiplies the domestic price per unit ($\text{\$}$5) with the equilibrium quantity (40 million)
Option D multiplies the world price per unit ($\text{\$}$3) with the domestic demand (70 million)

Key idea​:
The slope of the PPC reflects the opportunity cost of production.

Explanation​:
Country $B$ does not have a comparative advantage in the production of apples because the opportunity cost of producing apples is lower in Country $A$ as it has a flatter PPC. A country with a flatter PPC has a comparative advantage in producing the commodity measured on the horizontal axis.

Option A is correct because the PPC of Country $A$ is above the PPC of Country $B$, which means it can produce more of both goods using the same number of resources.

Option B is correct, as Country $A$'s PPC is flatter than Country $B$'s. So, it has a comparative advantage in the production of apples.

Option C is correct as the PPC of Country $B$ is lower than that of Country $A$, which means it can produce less of both goods using the same number of resources.

Explanation​:
Choice (I) When the peso depreciates, Filpino exports become relatively cheaper, while imports become relatively more expensive. An increase in net exports shifts the aggregate demand curve to the right causing demand-pull inflation.

Choice (II) An increase in the cost of imported inputs increases production costs, shifting the short-run aggregate supply curve to the left, increasing the average price level and decreasing real GDP in equilibrium.

Choice (III) Depreciation should improve the trade balance, increasing aggregate demand.

Choice (IV) Depreciation raises the cost of imported inputs, decreasing aggregate supply.

Explanation​:
When a tariff is imposed:

• The domestic quantity supplied is at the intersection of the SdomesticSdomestic​ and the Sworld+tariffSworld+tariff​ curves (125 000 units).
• The domestic quantity demanded is at the intersection of the DdomesticDdomestic​ and the Sworld+tariffSworld+tariff​ curves (275 000 units).
• The quantity of imports is the difference between domestic quantity demanded and supplied (275 000 $-$ 125 000 = 150 000 units).

Choices A, B, and D are incorrect because they confuse pre-tariff figures with post-tariff figures for at least one of the variables.

Explanation​:
Joining a monetary union eliminates a country's ability to conduct its monetary policy. For example, the European Central Bank (ECB) conducts monetary policy for the Eurozone. ECB actions affect all countries in the Eurozone. This lack of customisation poses a disadvantage rather than an advantage for individual countries.

These answer choices indicate advantages of joining a monetary union:

(Choice B) Exchange rate fluctuation creates uncertainty among exporters and importers. The adoption of a single currency promotes certainty, increasing international trade.

(Choice C) Price transparency refers to the ability of consumers and firms to compare prices. If countries join the monetary union and adopt a single currency, exchange rate conversions will not be necessary, making it more convenient for consumers and firms.

(Choice D) Inward investments mean investment from outsiders/non-members towards a member country. Joining a monetary union promotes certainty due to the absence of currency risk and hence promotes inward investment.

Explanation​:
The current account is the sum of the following values:

• exported goods - imported goods
• exported services - imported services
• net current transfers
• net incomes

Plugging in the given values:

Balance on current account = 450 −120−500 = −$170 million

The following options apply the formula incorrectly and include the capital transfers (a component of the capital account):

• Option B is calculated as 450−500+120+45
• Option C is calculated as 450−120+45
• Option D is calculated as 450−120−500+45

Explanation​:
(I) Price divergence between exports and imports may cause potential balance of payments problems.
(II) Price volatility for primary commodities contributes to economic instability in terms of greater income risks for individual farmers and governments.
(III) Primary export revenues may cause the domestic currency to appreciate, making other exports less competitive.
(IV) The allocation of windfall incomes can cause conflict and political instability in resource-rich countries by exacerbating issues related to poor governance and dependence on primary commodities.

Explanation​:
Trade diversion happens when the formation of a trading bloc shifts production from a low-cost producer to a high-cost producer. For example, joining a customs union can require a common external tariff, raising the price of imports from low-cost producers. As a result, trade diverts to higher cost members of the customs union.

Choice B is incorrect because trade creation happens when the entry of a country into a trading bloc shifts production from a high-cost producer to a low-cost producer.

These answer choices do not specifically address the impact of joining trading blocs:

• Choice C refers to comparative advantage which is the reason production costs are high or low. It does not explain why production shifts from one producer to another.
• Choice D refers to increased competition, but production moving from low-cost to high-cost producers results from reduced competition.

Statement II: Import quotas are a form of trade protection as they directly limit the quantity of imports of a particular good into a country.

Statement III: While austerity measures can be used to make a country's output more competitive globally through reducing the overall price level, their explicit goal is not to favour domestic production over foreign production.

Explanation​:
Statement I: an argument for trade protection is infant industries may be unable to compete against cheap imports from abroad, so tariffs keep infant industries competitive until they are fully established.

Statement II: national security concerns are a commonly-cited argument for trade protection, especially in the case of drugs, weapons, and essential goods.

Statement III: tariffs can be used to counter dumping by other countries, which happens when they sell their product at prices below cost as a way of getting rid of their surplus. This is unfair to domestic industries who may not be able to compete.

Statement IV: Less choice for consumers is an argument against trade protection, as it creates less variety in the imports of goods that are made available to domestic consumers.

Explanation​:  D is the correct choice because, in a trade deficit, the quantity supplied of domestic currency to buy imports exceeds the quantity demanded of domestic currency to buy exports.

The supply curve for the domestic currency shifts right as a result (S11​ to S22​) and the currency depreciates (xr11​ to xr22​).

A, B, and C are consistent with trade deficits. Since exports are less than imports, the demand for foreign currency is greater than the supply of foreign currency (Choice C) driving foreign currency appreciation (Choices B $\&$ C) or domestic currency depreciation (Choice A).

Explanation​:
The current account of the BOP includes:

• Exports and imports of goods and services
• Net current transfers
• Net incomes

Foreign direct investments are included in the financial account of the BOP

Options A, B, and C are components of the current account:

• Option A is an export of goods
• Option B is an export of services
• Option C is a component of net incomes

Explanation​:
Devaluing the currency would increase the volume of exports and decrease the volume of imports. Assuming the Marshall-Lerner condition is met, this will increase the value of (X-M), which increases AD, which increases employment.

Choice A is incorrect as stimulating AD will increase the price level.

Choice B is incorrect as there is no direct relationship between currency value and income/wealth inequality.

Choice D is incorrect as devaluing the currency directly increases export volume and reduces import volume.

Explanation​:
C is correct because an overvalued currency's exchange rate is kept artificially high, above the equilibrium in a floating exchange rate regime.

A and B are incorrect because they imply appreciation or depreciation, not overvaluation.

D is wrong because it defines an undervalued currency.

Explanation​:
If a country has a comparative advantage, it specialises in the production and export of one commodity, and can benefit from economies of scale. Economies of scale lower the cost of production.

Options A and D are incorrect statements:

• Option A is incorrect because technology keeps changing.
• Option D is incorrect as geographical and occupational barriers adversely affect mobility of resources.

Option C is a true statement describing a disadvantage of comparative advantage: specialisation can limit structural changes in a society.

Explanation​:
The WTO aims at liberalising trade and discourages trade protection.

The WTO’s stated goals include choices A, B, and C.

Explanation​:
The HDI is a composite indicator measuring economic development across three dimensions:

• Standard of living, measured by GNI per capita (PPP) (Choice B)
• Education, measured by mean years of schooling (Choice C) and expected years of schooling
• Health, measured by life expectancy at birth (Choice D)

Explanation​:
Interventionist supply-side policies may be a burden on the government budget but they often lead to a more equitable distribution of income, and less economic inequality.

Choices A, C, and D are possible drawbacks of such policies: they are expensive and may place an unsustainable burden on national debt, they involve long time-lags, and the increased government spending may create inflationary pressures in the economy.

Explanation​:
Statement I: this is a possible downside because these policies often show their desired results in the long-run

Statement II: this is another downside because these policies are expensive and entail a huge opportunity cost

Statement III: this is a positive effect of these policies are they will help potential export industries to expand and employ more workers

Statement IV: this is a positive effect of such policies because those potential export industries will compete against industries from foreign countries and this will encourage them to be more efficient

Explanation​:
The Marshall-Lerner condition (MLC) states that if the sum of elasticities of demand for exports and imports exceeds 1, currency depreciation will improve the BOT.

Options A, C, and D are incorrect as they don't satisfy the MLC:

• Option A: PEDx +PEDm = 0.9
• Option C: PEDx +PEDm =1
• Option D: PEDx +PEDm =1

Explanation​:
Provision of merit goods like education and healthcare will improve levels of human capital in the long run and allow workers to be more productive and thus earn higher incomes. In the long run, this will also lead to less inequality.

Choices A, C, and D are development strategies but they do not necessarily address levels of human capital or economic inequality.

Export promotion is a strategy used to address low levels of foreign exchange and an overdependence on imports.

Deregulation is a strategy used to encourage foreign direct investment and attract foreign capital.

Economic integration is a strategy used to reduce trade barriers and encourage free trade.

Explanation​:
Choice D is correct because although environmental regulations increase costs and create bureaucratic obstacles for businesses, they can spur innovation and encourage sustainable practices, leading to long-term economic advantages.

Choice A is incorrect because when land rights are lacking or insecure, individuals may face difficulties in accessing housing and food production.

Choice B is incorrect because if the poorest of the poor are excluded from accessing credit, they will struggle to generate economic activity.

Choice C is incorrect because women and girls facing discrimination will have limited economic opportunities in terms of education, health, work, and access to finance, contributing to greater poverty.

Explanation​: 

The above green area is the deadweight loss incurred due to the quota. When the quota is removed, overall economic welfare increases by that amount.

Choice B is wrong, as domestic consumers pay PWORLDPWORLD​ after the quota is eliminated.

Choice C is wrong, as the domestic consumer surplus decreases by the blue area.

Choice D is wrong, as the value of net exports should decrease, as the country imports more now (Q1Q5>Q1Q3).

Explanation​:
Sustainable development is defined as development that meets the needs of present generations without compromising the needs of future generations.

Options A, B, and D are incorrect:
Option A: as it doesn't mention the needs of future generations
Option B: as it doesn't mention the needs of present generations
Option D: as it does state that the needs of future generations are met but at the cost of the present generations