Domestic producers of a good become better off, and domestic consumers of a good become worse off, when a country begins allowing international trade in that good and
a. the country becomes an importer of the good as a result.
b. the world price exceeds the domestic price of the good that prevailed before international trade was allowed.
c. other countries have a comparative advantage, relative to the country in question, in producing the good.
d. total surplus does not change as a result.
b
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Consider an industry that produces an output Q with marginal private cost (MC) and marginal social cost (MSC) as given in the table:
Q MC MSC 1 2 4 2 4 7 3 6 10 4 8 13 5 10 16 Which of the following is TRUE? A) The production of each additional unit results in a larger marginal external cost. B) The production of each additional unit results in the same marginal external cost. C) The production of each additional unit results in a lower marginal external cost. D) There are no marginal external costs associated with the production of this good.
The aggregate demand curve:
a. shows the level of real GDP purchased in the economy at different possible price levels during a period of time. b. shows the level of real GDP produced in the economy at different possible price levels during a period of time. c. shifts to the left whenever there is an increase in aggregate expenditures. d. slopes upward.
Food and clothing tend to have
a. small income elasticities because consumers, regardless of their incomes, choose to buy relatively constant quantities of these goods. b. small income elasticities because consumers buy proportionately more of both goods at higher income levels than they buy at low income levels. c. large income elasticities because they are necessities. d. large income elasticities because they are relatively inexpensive.
The range of laws, rules, and regulations that define the allowed forms of use and transfer of resources is called the __________ structure of the economy
A) monetary B) property rights C) microeconomic D) macroeconomic