Economists will often argue that an individual trade barrier designed to help a particular industry will work even though on net it won't help the economy as a whole. Explain what this means
What will be an ideal response?
It's possible that the industry that the trade barriers were designed for will benefit. However, because the trade barrier will inevitably drive costs up to other firms in other industries it is possible that the economy as a whole may not benefit. Also, by restricting trade in one industry a nation is also reducing the income creating potential of its trading partners which will reduce its own ability to export goods and services as well.
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Use the table below to answer the next question.YearEmployedStructuralFrictionalCyclicalUnemployed20031,800501005020020042,400100100 30020052,000 15018050020062,66040 0140Determine the number of people cyclically unemployed for the year 2004.
A. 200 B. 100 C. -100 D. 0
One major component of money supply M1, demand deposits, is part of a bank's
A. net worth. B. liabilities. C. reserves. D. assets.
A profit-maximizing monopolist
a. never produces on the inelastic portion of the demand curve because it can increase profit by increasing output b. never produces on the inelastic portion of the demand curve because marginal revenue exceeds marginal cost c. always produces on the inelastic portion of the demand curve d. never produces on the elastic portion of the demand curve because there are no substitutes for the good it produces e. never produces on the inelastic portion of the demand curve because marginal revenue is negative there
A combination of an increase in the discount rate and an open market sale of government securities by the Fed would: a. increase the money supply
b. decrease the money supply. c. leave the money supply unchanged. d. have an indeterminate effect on the money supply.