Smith argues that American producers cannot compete with foreign producers because wages are lower in foreign countries than in the United States. Smith is
A) advancing the foreign export subsidies argument for protectionism.
B) making the mistake of believing that high wages mean high costs.
C) advancing the antidumping argument for protectionism.
D) making the mistake of believing that productivity is higher in foreign countries than in the United States.
E) none of the above
B
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If firms in an industry differentiated their products and made economic profits in the short-run, what other characteristic would be important to determine if this is an oligopoly or a monopolistically competitive market?
A) the number of firms in the market B) the number of close substitutes for the good being produced C) the number of buyers in the market D) if the good being sold is a normal or inferior good
Briefly explain the effects on potential GDP of cutting each of the following taxes: a. Individual income tax b. Corporate income tax c. Taxes on dividends and capital gains
What will be an ideal response?
The relationship between a change in the price of a complementary good and demand for another complementary good is
A) positive. B) negative. C) inconclusive. D) zero.
In the probit model Pr(Y = 1|X1, X2,..., Xk) = ?(?0 + ?1X1 + ?2X2 + ... + ?kXk),
A) the ?'s do not have a simple interpretation. B) the slopes tell you the effect of a unit increase in X on the probability of Y. C) ?0 cannot be negative since probabilities have to lie between 0 and 1. D) ?0 is the probability of observing Y when all X's are 0