Which of the following situations will arise in the domestic market following the imposition of a voluntary export restraint?
A. imports increase, domestic production increases, prices increase
B. imports decrease, domestic production increases, prices increase
C. imports increase, domestic production decreases, prices decrease
D. imports decrease, domestic production increases, prices decrease
Answer: B
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Of the following activities, specify which ones would typically generate positive externalities, negative externalities, or no externalities:
a. You decide to trade in your 1997 Cadillac for a 100% electric Nissan Leaf. b. Every morning while in the shower, you sing at the top of your lungs and very much off-key as long as no one else is at home. c. You choose to not clean up after your German Shepherd when you take him for his midnight walks around the neighborhood. d. After running out of space in your house, you decide to store your collection of 46 broken lawn mowers in your front yard. e. As you do every year, this year you get a flu shot at the local Walgreens.
Use the above figure. For this monopolistic competitor, which of the following is INCORRECT?
A) The profit-maximizing rate of output is qe, and the profit-maximizing price is P. B) The demand curve shows a direct relationship between price and quantity demanded. C) The profit-maximizing rate of output is at E, where MR intersects MC. D) A downward sloping marginal revenue curve that is below the demand curve.
Something that would not be considered a tool in pursuit of industrial policy would be:
A. incentives for foreign direct investment. B. incentives for foreign portfolio investment. C. investment in research. D. All of these are examples of industrial policies.
Which of the following statements about a monopolistically competitive firm is FALSE?
A. It may earn short-run economic profits. B. It sets price like a perfectly competitive firm. C. It produces the quantity at which MC=MR. D. It tries to differentiate its product from that of competitors.