A tariff
a. is usually set by domestic producers of a good
b. can be either a fixed dollar amount or a percentage of a good's value
c. decreases domestic price for a good, holding all else constant
d. improves economic efficiency in the importing nation
e. improves economic efficiency in the exporting nation
B
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The fact that output gaps will not last indefinitely, but will be closed by rising or falling inflation is the economy's:
A. income-expenditure multiplier. B. self-correcting property. C. short-run equilibrium property. D. long-run equilibrium property.
A prediction from the kinked-demand curve model of noncollusive oligopoly is that, for an individual firm, small changes in:
A. demand will not lead to changes in price or output. B. marginal cost will not lead to changes in price or output. C. marginal revenue will lead to changes in price and output. D. marginal cost will lead to changes in price and output.
Will a monopolist produce at a quantity that is higher than the long-run competitive equilibrium output level?
A. No, profit maximization for a monopoly always occur at a lower output level than in a competitive market. B. Yes, the monopoly always produces at an output level larger than in a competitive market. C. Yes, but only if it is a monopoly because it holds a patent. D. There is no theory in microeconomics that states that a monopolist produces larger or smaller output than in a perfectly competitive firm in the long-run.
Why might a politician start a costly spending program if its costs exceed its social benefits?
A. The costs cannot be measured therefore the politicians focus on the benefits which are explicit. B. The politician is trying to find ways to raise more money for the next election. C. Voters do not care about the costs of programs, as long as their taxes do not go up. D. The politician gains prestige and voters are not well informed of the benefits and costs.