Define the four basic types of trade barriers.
What will be an ideal response?
First, tariffs are excise taxes on imports. They may be used to collect revenue or government for they may be protective tariffs that are supposed to protect domestic producers from foreign competition. Second, import quotas specify the maximum amounts of imports allowed into a nation over a period of time. Third, non tariff barriers refer to licensing requirements, unreasonable standards, or bureaucratic red tape in customs procedures. Fourth, there can be voluntary export restrictions, which are agreements by foreign firms to “voluntarily” limit their exports to another nation.
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The labor demand curve of a firm
A. is the same as its marginal product curve. B. reflects a direct relationship between the number of workers hired and the money wage rate. C. is perfectly elastic if the firm is selling its product in a purely competitive market. D. will shift to the left if the price of the product the labor is producing falls.
If a firm’s fixed cost (overhead) increases, what happens to its profit-maximizing price and output?
What will be an ideal response?
Our measurement of output per worker is called:
A. productivity. B. production growth rate. C. nominal output. D. None of these is true.
If the production function is Q = K.5L.5 and capital is fixed at 1 unit, then the average product of labor when L = 25 is:
A. 10. B. 1/5. C. 2/5. D. None of the answers are correct.