Which of the following statements about an export subsidy on a particular product is accurate?
A. An export subsidy increases the net national well-being of a large exporting country.
B. An export subsidy can switch the product from being exported to being imported.
C. An export subsidy reduces the amount available in the domestic market of the exporting country and increases the amount imported by the foreign country.
D. An export subsidy increases the price paid by foreign buyers, relative to the price that local consumers pay for the product.
Answer: C
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A stronger U.S. dollar in world exchange markets means that
A) foreigners sell the dollars that they have. B) a dollar buys more units of foreign currency than it could before. C) a dollar buys less units of foreign currency than it could before. D) a dollar buys the same amount of foreign currency than it could before, with gold backing up the value of the dollar.
Since 1900, real GDP in the United States has grown
A) more rapidly than the population. B) as rapidly as the population. C) more slowly than the population. D) in a random unpredictable manner relative to the population.
"Protection" is designed to help
a. firms whose relative inefficiency does not permit successful competition with imports. b. workers who have very high productivity, and cannot survive against low-paid foreign workers. c. government that needs revenue from tariffs and quotas to cover government spending. d. firms that are highly efficient, and cannot survive against low-price foreign imports.
The production function shows
A) the incremental output gained by improving the production process.
B) the maximum output that can be produced from each possible quantity of inputs.
C) the technology used to produce output.
D) the total cost of producing a given quantity of output.