If a country imposes a $10 tariff on a foreign monopolist, the price received by the monopolist, net of the tariff, will:
a. fall by $10.
b. fall by less than $10.
c. fall by more than $10.
d. fall by $0.
Ans: b. fall by less than $10.
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A) increases; increases; rises B) decreases; decreases; falls C) increases; decreases; falls D) decreases; increases; rises
Middlemen, such as grocers, stockbrokers, and realtors
a. specialize in reducing transactions costs. b. provide nothing of value to either the buyer or the seller. c. have no effect on economic output in society. d. do not exist in capitalist economies.
Which of the following is a function of the lender of last resort?
a. Keeping the velocity of money at a low level b. Reducing the supply of money and loans in an economy c. Providing short-term emergency loans in conditions of financial crisis in an economy d. Increasing the supply of money and the quantity of loans in an economy
One of the widely acknowledged problems with using the consumer price index as a measure of the cost of living is that the CPI
a. fails to measure all changes in the quality of goods. b. displays a housing bias. c. accounts for changes in prices of some goods, but prices of certain goods are assumed to remain constant. d. All of the above are correct.