It is well documented that traveling on our nation's highways at lower speeds saves money on fuel and reduces accidents. Assume that a driver understands this but is unwilling to drive slower until he observes everyone else doing it
Can you make a parallel between this attitude and the case where countries will refuse to lower their tariffs unless their trading partners do the same?
The two arguments are equally flawed. If driving slower is going to save you money on fuel and will reduce your likelihood of having an accident you should drive slower. The same is true of tariff reduction. If reducing tariffs makes your country better off then it doesn't matter whether your trading partners follow your lead. You should cut tariffs anyway.
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In a competitive market for a private good with no price or quantity regulations, no external cost nor external benefit, low transactions costs, and no taxes or subsidies,
A) the allocation of resources is planned by the government. B) production is organized by government organizations. C) efficiency can be attained in the market with no government intervention. D) efficiency is usually be achieved by majority rule. E) efficiency is generally obtained by using a command system.
According to your textbook, Keynesian economic theory
A) argues that federal budget deficits were necessary during periods of rapid economic growth. B) questioned the use of the federal budget deficit as a policy tool to manipulate and fine-tune the economy. C) helped break the mentality that federal budget deficits were improper. D) did all of the above. E) did none of the above.
The U.S. Lorenz curve today is closer to the perfect equality line than in 1929
a. True b. False Indicate whether the statement is true or false
Total surplus in a market can be measured as the area below the supply curve plus the area above the demand curve, up to the point of equilibrium
a. True b. False Indicate whether the statement is true or false