Denmark has a comparative advantage in cheese production, and Holland has a comparative advantage in beer production
The two countries initially trade cheese and beer based on their comparative advantages, but the government of Denmark later closes the border to trade with Holland. What is the likely impact of this trade restriction? A) Danish cheese consumers are worse off, and beer producers in Holland are better off.
B) Cheese consumers in both countries are worse off.
C) Beer consumers in Holland are worse off, and cheese producers in Denmark are better off.
D) Beer consumers in Holland are better off, and cheese producers in Holland are better off.
D
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Suppose the demand for peaches from South Carolina is perfectly elastic. If the supply curve is upward sloping and a tax is imposed on peaches from South Carolina, then
A) peach sellers pay all of the tax. B) peach buyers pay all of the tax. C) peach buyers and sellers evenly split the tax. D) the government does not collect any revenue from the tax. E) the tax does not change the equilibrium quantity of peaches.
In the table above, the firm producing the product is
A) a monopoly. B) an oligopoly. C) a duopoly. D) perfectly competitive.
A market demand curve is
a. the sum of the demand curves of individuals in a market b. the sum of individuals who make demands c. horizontal at the market price d. vertical at the market price e. upward sloping
If an increase in the price of good X leads to a decrease in the demand for good Y, then:
A. good X is a normal good and good Y is an inferior good. B. good X and good Y are normal goods. C. good X and good Y are substitutes. D. good X and good Y are complements.