What will happen if there is an increase in an existing tariff on grapes from Argentina?
a. There will be an increase in domestic production of grapes.
b. There will be an increase in total American consumption of grapes.
c. There will be an increase in American consumption of domestically produced grapes.
d. There will be an increase in American imports of grapes from Argentina.
c. There will be an increase in American consumption of domestically produced grapes.
Raising an existing tariff on grapes from Argentina will increase American consumption of domestically produced grapes.
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What is the meaning of the term "marginal rate of substitution"?
What will be an ideal response?
Two goods are considered substitutes when the cross elasticity of demand is ___ and complements when the cross elasticity of demand is ___
a. Greater than zero, less than zero. b. Less than zero, greater than zero. c. Greater than one, less than one. d. Less than one, greater than one.
Positive economics concerns
a. reflections of a country's values b. judgments on the merit of an economic outcome c. statements of fact concerning the economy d. analysis of what ought to be e. analysis of all good or positive market outcomes
The electric power company in a city increased its prices by 15% this year. Since the demand for electricity is a(n) ________ demand in the short run, the equilibrium price will ________.
A. inelastic; greatly increase B. elastic; decrease C. inelastic; decrease