A tariff imposed by the United States on Japanese cars ________ the price of cars in the United States and ________ the quantity of Japanese cars imported into the United States
A) raises; increases
B) raises; decreases
C) lowers; increases
D) lowers; decreases
B
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Suppose a firm's short-run production function is given by Q = F(L) = 4L. If the wage rate is $12 and the firm has sunk costs of $300, then the firm's variable cost function is:
A. VC(Q) = $12Q. B. VC(L) = $3L. C. VC(Q) = $3Q. D. VC(Q) = $300 + $12Q.
The demand curve for money
a. shows the amount of money balances that individuals and businesses wish to hold at various interest rates. b. reflects the open market operations policy of the Federal Reserve. c. shows the amount of money that individuals and businesses wish to hold at various price levels. d. reflects the discount rate policy of the Federal Reserve.
When externalities are present in the market, what results?
a) The established equilibrium maximizes the total benefit to society as a whole. b) Market participants lose some market benefits to bystanders. c) Both equity and efficiency are maximized. d) The market fails to allocate resources efficiently.
Natural monopolies:
A. are the only monopolies that are efficient. B. generally earn zero accounting profits due to regulations. C. can capture the lowest production costs possible for the industry. D. are always protected by government policy.