Which of the following is NOT among the common arguments for protection?
A. Trade can be disruptive to sectors of society facing foreign competition for the first time, as with small towns built around a single industry.
B. A new or small industry in a country could be crushed by more mature foreign competitors, so the industry should be protected until it is on an equal footing with the foreign competition.
C. More international trade will tend to reduce the value of the domestic currency, hurting savers.
D. Major war could cut off imports from other countries and leave a country dependent on its own industries, so a nation should protect industries important to conducting a war.
Answer: C
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Of the following, demand is likely to be the most elastic for
A) food. B) cars. C) Sony Blu-ray players. D) personal computers.
The demand for a monopolistically competitive firm's product is
A. perfectly elastic. B. more elastic than for a monopoly. C. more inelastic than for a monopoly. D. perfectly inelastic.
Every time we use scarce resources in one way, we give up the opportunity to use them in other ways.
Answer the following statement true (T) or false (F)
Foreign aid:
A. provided by developed countries to developing countries represents about 10 percent of the GDP of developed countries. B. is an important source of funding for investment in most developing countries. C. does not contribute much to domestic investment in most developing countries. D. is largely wasted in most developing countries because it comes with no strings attached.