Government price controls
a. strip market prices of their ability to signal relative scarcities to both buyers and sellers.
b. often impose harm on at least some of the group of people they are trying to assist.
c. sometimes force prices above or below what they would be in a market economy
d. all of the above
d
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Refer to the figure above. If A forms a customs union with C, the quantity of trade creation will be
A) 100 units. B) 70 units. C) 30 units. D) None of the above.
One way the government provides public goods is by ________________, which helps to spread the cost around and eliminates the free-rider problem.
a. supporting research and development b. charging per-use fees, such as tolls c. taxation d. exclusionary participation
Why do businesses incorporate, and why do investors buy stocks?
What will be an ideal response?
The ability of the DVCs to use the technologies of the IACs is somewhat limited because:
A. the IACs have patents on most of their technologies. B. the IACs and the DVCs have much different resource endowments. C. the technologies of the IACs rely heavily on unskilled labor. D. IAC technologies are labor-intensive, while DVC technologies are capital-intensive.