In this welfare effects of a tax graph, we can see that the tax changed consumer surplus from a + b + c to _____.
a. a + b
b. a
c. a – c
d. b + c
b. a
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The value of a country's exports during a particular year was $120,000 and the value of its imports was $85,000. Which of the following is true?
A) The country ran a fiscal deficit of $205,000 during that year. B) The country ran a trade surplus of $35,000 during that year. C) The country ran a budget surplus of $205,000 during that year. D) The country ran a trade deficit of $35,000 during that year.
The above figure shows the payoff matrix for two firms, A and B, selecting an advertising budget. The firms must choose between a high advertising budget and a low advertising budget. A Nash equilibrium
A) occurs when both firms select a high advertising budget. B) exists at any of the four possible strategy combinations because there is never an incentive to change strategy. C) is for both firms to choose the low advertising budget because this yields the highest joint profit. D) does not exist because firm A does not have a dominant strategy.
An advantage of transfer payments over public works as a means of reducing unemployment is that transfer payments
a. provide more direct aid to those suffering most from unemployment. b. are unlikely to decrease unintended excess inventories of consumer goods. c. generate more secondary and tertiary employment. d. tend to have a larger multiplier effect.
Most economists
A. favor tariffs. B. favor quotas. C. advocate "fair trade." D. Economists do not favor any of these.