The imperfect capital market justification for infant industry promotion
A) assumes that new industries will tend to have low profits.
B) assumes that infant industries will soon mature.
C) assumes that infant industries will be in products of comparative advantage.
D) assumes that banks can allocate resources efficiently.
E) assumes that developing country will reward the donor country.
A
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Because firms produce a differentiated product, each of the firms in a monopolistically competitive market faces a demand curve that is:
A) perfectly elastic. B) perfectly inelastic. C) downward sloping. D) perfectly elastic or perfectly inelastic depending on whether the firm's output is a luxury or a necessity.
We can infer that the government is following a restrictive fiscal policy when
A) the actual deficit falls. B) the natural employment deficit falls. C) the actual deficit rises. D) the natural employment deficit rises.
If a firm offers a senior citizen discount,
A) the firm expects the average senior citizen to have a lower price elasticity of demand. B) the firm expects the average senior citizen to have a higher price elasticity of demand. C) senior citizens may be offended. D) it may be prosecuted for discrimination.
An economist might say that people choose not to get a college degree because they may have to borrow money to go to college, and the interest they have to pay on that loan in the future will affect their decisions today. This is an example of which kind of statement?
a. positive statement b. normative statement c. trade-off statement d. allocative statement