Under which of the following situations will a tariff imposed by a country fail to reduce imports by as much as expected?
A. The domestic supply of the import-competing products is more price-elastic than was expected.
B. The current tariff rate is less than the prohibitive tariff rate.
C. The domestic quantity demanded of the imported product is less responsive to price changes than was expected.
D. The foreign export quantity supplied of the good imported by this country is more responsive to changes in the world price than was expected.
Answer: C
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Refer to Figure 5-6. What does D2 represent?
A) the demand curve reflecting marginal social benefits B) the positive externalities curve C) the demand curve reflecting marginal private benefits D) the social welfare curve
If oligopolists engaged in some sort of collusion, industry output would be __________ and the price would be __________ than under perfect competition
a. smaller, lower b. smaller, higher c. smaller, no different d. greater, lower e. greater, higher
Repeat the exercise using total analysis (i.e., total social benefits (TSB) and total social costs (TSC)).
What will be an ideal response?
A firm should shut down in the short run if it s AVC is less than the price it receives per unit of the good.
Answer the following statement true (T) or false (F)