A model that sometimes makes incorrect predictions may be used by economic decision makers
a. under no circumstances
b. only if its assumptions are detailed and realistic
c. if it is mathematical and computerized
d. if it is simple enough for a child to understand
e. until a better model is developed
E
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Demand-side market failures refer to those situations when there is a shortage in the market because buyers want to buy more than what is available in the market.
a. true b. false
A tax is imposed on orange juice. Consumers will bear no burden from this tax if the: a. demand for orange juice is perfectly inelastic
b. supply curve for orange juice is unit elastic. c. demand for orange juice is unit elastic. d. supply curve for orange juice is perfectly inelastic.
If Brazil buys $100 million of tractors from the U.S., then U.S. net exports will decrease
a. True b. False Indicate whether the statement is true or false
When countries have different comparative advantages, the total gains from trade for all countries are larger than losses from trade.
a. true b. false