Tariffs increase equilibrium price and quantity.
Answer the following statement true (T) or false (F)
False
Tariffs increase equilibrium price and reduce equilibrium quantity. A tariff shifts the supply curve to the left resulting in higher equilibrium price and lower equilibrium quantity.
You might also like to view...
Because a monopoly ignores external costs, it is possible that it will
A) produce the socially optimal quantity of a good. B) produce more than the socially optimal quantity of a good. C) produce less than the socially optimal quantity of a good. D) All of the above.
An anti-inflation policy that involves announcing and executing tough measures to stop inflation is called _____
a. cold turkey b. red tape c. a pork-barrel policy d. chokehold e. time-inconsistency
The model: G(z) = [exp(z)]/[1 + exp(z)], where G is between zero and one for all real numbers ‘z', represents a:
A. logit model. B. probit model. C. Tobit model. D. linear probability model.
In the case before her, Judge Thomas has heard claims by orange growers that to order a stop to orange growing in order to control a pest that thrives on oranges plants but does not harm them would result in a loss of profits of $3 million a year. The pest however causes $2 million of damages to trees owned by pulp manufacturers. The orange growers have not mentioned that they could control the pest at a cost of $1 million per year. High transactions costs have prevented the parties from reaching a private agreement. If she gives the property right to the
a. orange growers, they will then voluntarily control the pest. b. orange growers, they will not control the pest. c. pulp manufacturers, they will pay the orange growers to control the pest. d. pulp manufacturers, the orange growers would offer a side payment of at least $2 million to be able to grow oranges.