According to the infant industry argument for trade protectionism:
A. trade barriers must be used to protect domestic workers.
B. new industries need to be shielded from competition in the early stages of learning by doing.
C. tariffs imposed to aid new industries should never be removed.
D. new industries are capable of competing with established rivals.
Answer: B
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At any point in time, a single bank can loan an amount equal to
A) its excess reserves. B) its required reserves. C) its government securities. D) the amount of loans the bank made in the past. E) its total reserves.
If resource prices rise and the average total cost of producing a product increases as the firms in an industry expand output in response to an increase in demand, the long-run market supply curve for the product will
a. be perfectly elastic (a horizontal line). b. be perfectly inelastic (a vertical line). c. slope upward to the right. d. be more inelastic than the short-run supply curve for the product.
If the demand for a good decreases because consumer income increases, the good is a(n):
A. inferior good. B. normal good. C. necessity good. D. luxury good.
Suppose that a tire factory produces $825,000 of output and causes $70,000 worth of pollution as a result of production. The tire factory's official contribution to GDP would be ________ and its overall contribution to society would be ________.
A. $825,000; $895,000 B. $895,000; $825,000 C. $825,000; $755,000 D. $755,000; $825,000