Unlike a tariff, a quota does not cause either a production effect or a consumption effect.
Answer the following statement true (T) or false (F)
False
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If the Fed decreases the nominal interest rate by 2 percent, how will the real interest rate change in the short run?
a. It will decrease by 1 percent. b. It will decrease by 2 percent. c. It will increase by 1 percent. d. It will increase by 2 percent.
The horizontal summation of all individual quantities demanded at different given prices results in the
A. market supply curve. B. market demand curve. C. individual demand curve. D. equilibrium demand and supply curves.
Other things equal, which reduces competition in an industry?
A. Patent laws. B. Freedom of entry for new firms. C. An increase in the number of buyers. D. An increase in the number of producers.
When no property rights exist
A. no one has an economic incentive to care for common property, and an externality may well occur. B. externalities will be internalized by voluntary arrangements among a small group of parties. C. society will produce beyond the production possibilities frontier, but the allocation of resources is not apt to be optimal. D. there will be no production.