To say that government intervenes in the economy to promote efficiency is to say that government is attempting to
a. create a more fair distribution of income.
b. change the way in which the economic pie is divided.
c. enlarge the economic pie.
d. All of the above are correct.
c
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Which of the following is an explanation for the existence of trade restrictions?
A) Tariffs generate revenue for the government. B) rent seeking C) inefficient quotas D) Both answers A and B are key explanations.
Free trade means that nations can buy and sell goods from each other
a. unless absolute advantage favors one nation b. without government interference, e.g., tariffs and quotas c. without having to abide by comparative advantage d. and choose their own level of tariffs against each other e. according to their own national quotas
A household that spends more than it receives in income during a given period is
A. saving. B. receiving transfer payments. C. running a deficit. D. dissaving.
When a nation starts opening up to international trade, it will see falling prices for:
A. Goods that it exports B. Goods that it imports C. Goods that it has a comparative advantage in D. All goods traded