Suppose that American firms claim that protectionism in Canada is on the rise as the Canadian government attempts to protect its infant industries with a "Buy Canadian" provision
This policy, similar to the original "Buy American" provision in the 2009 U.S. stimulus bill, is likely to cause
A) Canadian companies to pay lower prices for protected products.
B) exporting countries to retaliate by placing trade barriers on Canadian imports.
C) most countries to reduce their own trade barriers to be able to better compete with Canadian imports at home.
D) Canadian manufacturers to become more efficient.
B
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The "crowding-out" effect refers to the fact that
A) fiscal policy cannot be used to shift the IS curve. B) rising interest rates tend to accompany an expansionary fiscal policy. C) there may be a liquidity trap. D) All of these.
You are the manager of a firm that produces output in two plants. The demand for your firm's product is P = 20 ? Q, where Q = Q1 + Q2. The marginal costs associated with producing in the two plants are MC1 = 2 and MC2 = 2Q2. What is the profit-maximizing price that the firm should charge?
A. $11 B. $12 C. $9 D. $8
Wide price swings in farm products are the result of
A. Supply shifts and the relatively elastic demand for food. B. Supply shifts and the relatively inelastic demand for food. C. The high income elasticity of food demand. D. Demand shifts and the relatively elastic supply of food.
A firm with market power will be able to sell all of their output at any price they desire.
Answer the following statement true (T) or false (F)