Free trade policies may lead to
A. price increases in world markets.
B. some labor sectors experiencing some short-term job loss.
C. a decrease in world output.
D. none of these.
Answer: B
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Consider the following:
(i) Define the term diminishing marginal returns to labor. When diminishing marginal returns to labor exist, what can be said about the firm's cost curves? (ii) Define the term decreasing returns to scale. When decreasing returns to scale exist, what can be said about the firm's cost curves?
Sugarcane can be used to produce both granulated sugar and ethanol. Recent regulations in certain countries now permit a higher amount of ethanol to be added to gasoline. As a result of these changes, an economist would expect granulated sugar prices to ____, and quantity sold to ____.
A. rise; rise. B. fall; fall. C. rise; fall. D. fall; remain the same.
If movie theaters began collecting more gross income from ticket sales after lowering ticket prices, we would know
A) movie patrons were not behaving consistently with the law of demand. B) movie quality must have increased. C) the demand for movie tickets was elastic. D) the demand for movie tickets was inelastic. E) the supply of movies had increased.
Based on Scenario 6.1 above, value added in the United States is
A) $500. B) $600. C) $400. D) $300. E) None of the above.