A market failure occurs when the market outcome is not the socially efficient outcome
a. True
b. False
Indicate whether the statement is true or false
True
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If Px = Py, then when the consumer maximizes utility,
A) X must equal Y. B) MU(X) must equal MU(Y). C) MU(X) may equal MU(Y), but it is not necessarily so. D) X and Y must be substitutes.
The four major components of aggregate demand are consumption, investment, government purchases of goods and services, and net exports
a. True b. False Indicate whether the statement is true or false
The infant industry argument for protectionism is to block imports ______________ to give the infant industry time to mature before it starts competing on equal terms in the global economy.
a. for a limited time b. for a long time c. permanently d. never
Why is there often resistance to free trade?
A. Free trade does not benefit the economy as a whole. B. Specific groups may be hurt by free trade. C. Free trade usually hurts consumers. D. Free trade does not benefit the global economy.