If protective import-restricting tariffs are imposed by a country, in the majority of cases that nation's producers end up
A) receiving a higher price for the good than they otherwise would.
B) receiving a lower price for the good than they otherwise would.
C) producing less of the good than they otherwise would.
D) receiving a lower profit for the domestic good than they otherwise would.
Answer: A
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The existence of externalities is due mainly to the fact that
A) monopolies tend to produce too little of a good anyway. B) the optimal level of pollution is zero. C) pollution is not a serious problem. D) property rights are poorly defined.
Special Grapes is a new wine company that wants to locate its vineyard in Sonoma Country, California, an exclusive area of the world for wineries. Which of the following will likely have the largest effect on Special Grapes' input prices?
A) land prices in Sonoma County, California B) compensating wage differentials C) traffic regulations in Sonoma County, California D) the additional wages Special Grapes will have to pay its employees to work in Sonoma County, California
For which of the following goods is the income elasticity of demand likely highest?
a. natural gas b. doctor's visits c. hamburgers d. boats
Use the following graph showing the demand and marginal revenue curves faced by a pure monopoly to answer the next question.
What price should the pure monopoly charge to maximize total revenue?
A. P1 B. P2 C. P3 D. P4