Import tariffs generally ____ the output of domestic producers of the affected products and also ____ the output of domestic exporters
a. increase; increase
b. increase; decrease
c. decrease; increase
d. decrease; decrease
b
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If the exchange rate changes from 1 euro per U.S. dollar to 1.2 euros per U.S. dollar, the Euro has
a. appreciated, since its value has increased b. appreciated, since the price of U.S. dollars has increased c. appreciated, making U.S. goods cheaper in Euros d. depreciated, since its value has declined e. depreciated, since its value has increased
Suppose that Firms A and B each produce high-resolution computer monitors, but Firm A can do so at a lower cost. Cassie and David each want to purchase a high-resolution computer monitor, but David is willing to pay more than Cassie. If Firm B produces a monitor that David buys, then the market outcome illustrates which of the following principles? (i) Free markets allocate the supply of goods to
the buyers who value them most highly, as measured by their willingness to pay. (ii) Free markets allocate the demand for goods to the sellers who can produce them at the least cost. a. (i) only b. (ii) only c. both (i) and (ii) d. neither (i) nor (ii)
Why are economists sometimes skeptical about international labor standards?
a. They are difficult to enforce. b. They create more competition for U.S. workers. c. GATT does not allow labor standards. d. They may be used as a rationale to protect domestic activities that can no longer compete with imports.
______ is achieved when depreciation is subtracted from gross national product.
a. Personal income b. National income c. Net national product d. National domestic product