Among the problems associated with subsidizing an industry in the hope of establishing a worldwide monopoly is that if two nations subsidize firms in the same industry, each could lose money.
Answer the following statement true (T) or false (F)
True
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In the market for books, initially there are no taxes on books. Books are normal goods. The government introduces a tax of $4 a book and, at the same time, people's income fall by $4,000 a year
Following these two changes, the equilibrium quantity of books A) decreases. B) increases. C) remains unchanged. D) either increases or decreases. We cannot say which.
A tax that creates an excess burden may nevertheless improve efficiency if
A. consumption of the good has been generating beneficial externalities. B. consumption of the good has been generating no externalities. C. consumption of the good has been generating detrimental externalities. D. the good has been supplied by a monopolist.
For which of the following purchases would the absolute price elasticity of demand be greatest?
A) a luxury sedan B) utilities C) chewing gum D) a smartphone
When you purchase a bond in the secondary market, you are lending money directly to the borrower
a. True b. False Indicate whether the statement is true or false