Recall the Application about the attempt to form a salt cartel in the 19th century to answer the following question(s).According to the Application, what created local salt monopolies in the early 19th century?
A. high transportation costs that prevented competition
B. government regulation
C. local labor unions in salt mines
D. high taxes on salt that crossed state borders
Answer: A
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Starting from long-run equilibrium, an increase in autonomous investment results in ________ output in the short run and ________ output in the long run.
A. lower; potential B. higher; higher C. lower; higher D. higher; potential
In the short-run Keynesian model, if the mpc equals 0.8, then to decrease aggregate spending by $30 billion at any output level, government spending must be decreased by ________ or net taxes must be increased by ________.
A. more than $30 billion; more than $30 billion B. $30 billion; $30 billion C. $30 billion; more than $30 billion D. less than $30 billion; less than $30 billion
Moving along a short-run aggregate supply curve, resource prices ________, the money rate wage ________, and potential GDP ________
A) do not change; changes; does not change B) do not change; does not change; changes C) change; does not change; does not change D) do not change; does not change; does not change
The real exchange rate is an adjustment of the nominal exchange rate to account for
a. inflation at home and abroad b. supply and demand in the market c. government's assessment of its value d. currency amounts held by governments e. none of the above