Tariffs lead to
A. the contraction of relatively efficient industries.
B. an over allocation of resources to relatively efficient industries.
C. an increase in the foreign demand for domestically produced goods.
D. an under allocation of resources to relatively inefficient industries.
A. the contraction of relatively efficient industries.
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Arguments for Protectionism
Refer to above figure. With free trade and no tariffs, what is the quantity of Widgets imported?
What will be an ideal response?
Classical macroeconomists argue that the short-run Phillips curve ________ represent a usable trade-off for policymakers because ________
A) does; people have rational expectations B) does; people do not have rational expectations C) does not; people do not have rational expectations D) does not; people have rational expectations
Financial account transactions occur
A. when an U.S. citizen purchases stock in an U.S. corporation. B. because of cross-border flows of financial assets. C. when you move money from one U.S. bank to another U.S. bank. D. when an U.S. company purchases goods from a foreign company.