Refer to the information provided in Figure 33.4 below to answer the question(s) that follow.
Figure 33.4Refer to Figure 33.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. After the tariff is imposed
A. domestic production will increase by 50 wallets and domestic consumption will decrease by 50 wallets.
B. domestic production will increase by 100 wallets and domestic consumption will decrease by 100 wallets.
C. domestic production and consumption will increase by 50 wallets and domestic consumption will increase by 50 wallets.
D. domestic production will increase by 150 wallets and domestic consumption will decrease by 250 wallets.
Answer: A
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When two people are on the contract curve, the allocation of goods
A) cannot be improved. B) is pareto efficient. C) is such that neither individual can be made better off without making the other worse off. D) All of the above.
From a macroeconomic perspective, the problem of low household saving has probably been overstated because:
A. household saving has been increasing steadily over the last three decades. B. it is national saving, not household saving, that allows an economy to accumulate new capital. C. household saving is not related at all to an economy's ability to accumulate new capital. D. household saving represents a smaller share of national saving than does public saving.
When x increases
A) IS curve shifts to the left. B) IS curve shifts to the right. C) LM curve shifts upward. D) LM curve shifts downward.
The free floating exchange rate system has been in effect since
A. 1900. B. 1933. C. 1945. D. 1973.