Which of the following is not a reason why the prospects for the further expansion of developing country commodity exports are likely to be limited?
(a) Low income elasticities for these products.
(b) Low likelihood of development of further synthetic substitutes.
(c) Continued agricultural protection despite trade agreements.
(d) Declining terms of trade.
B
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A problem encountered when implementing an "infant industry" tariff is that
A) domestic consumers will purchase the foreign good regardless of the tariff. B) the industry may never "mature." C) most industries require tariff protection when they are mature. D) the tariff may hurt the industry's domestic sales. E) the tariffs fail to protect the domestic producers.
Suppose that the labor market for life guards is initially in equilibrium. Whistles are an important safety tool that life guards use as a part of their jobs. A fire destroys the largest factory that produces whistles. What happens to the equilibrium wage and quantity of life guards?
a. Both the equilibrium wage and quantity increase. b. Both the equilibrium wage and quantity decrease. c. The equilibrium wage increases, and the equilibrium quantity decreases. d. The equilibrium wage decreases, and the equilibrium quantity increases.
Which of the following is a characteristic of a competitive price-taker market?
A. Profit maximizing firms in the market will expand output until price equals average variable cost. B. The market demand curve for the product is a horizontal line. C. There are many firms in the market, each producing a small share of total market output. D. The product produced by each of the firms is differentiated.
Use the information provided in Table 7.4 below to answer the question(s) that follow. Table 7.4Inputs Required to Produce a Product Using Alternative TechnologiesTechnologyUnits of CapitalNumber of EmployeesA 836B 1224C 1616D 24 12Refer to Table 7.4. If the hourly price of capital is $40 and the hourly wage rate is $10, which production technology should be selected?
A. A B. B C. C D. D