As a result of U.S. tariffs imposed on wool from New Zealand, the quantity of this wool that is imported has
A) not changed.
B) increased a lot.
C) decreased.
D) increased a little.
E) changed but whether it has increased or decreased is ambiguous.
C
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When the cost of producing a product is paid, at least in part, by someone other than the producer, the cost is referred to as
A) an external cost. B) an external profit. C) an external benefit. D) an external/internal cost. E) a public cost.
Ricardian equivalence suggests that forward looking households ________ the future taxes required to pay off government debt, so that reductions in lump-sum taxes have ________ effect on the economy
A) fully anticipate; a multiplied B) fully anticipate; no C) are unaware of; a negative D) are unaware of; a positive
Two games that differ only in the timing of moves—one simultaneous, the other sequential move—can sometimes have completely different subgame-perfect equilibria. Why?
a. The second mover to choose non-credible threats. b. The first mover can choose an action that it would deviate from if its action were secret. c. Subgame-perfect equilibrium cannot be applied to simultaneous games. d. All of the above.
What can we conclude about our future after reading Chapter 1?
a. We will use up more resources faster and scarcity will become increasingly more severe. b. We will eventually run out of "things we want" causing scarcity to moderate. c. We will eventually run out of "things we want" causing scarcity to disappear. d. Resources will remain scarce and our wants unlimited so that scarcity will remain a fact of life. e. Technology will fully substitute for scarce resources so that even though our wants are unlimited, we will eventually eliminate scarcity.