Import restrictions due to the imposition of tariffs by the U.S. government
A. will ultimately cause inefficient resource allocation in the United States.
B. will lead to a decline in the quantity of the product consumed in the United States.
C. will lead to lower incomes in the economy of U.S. trade partners.
D. All of these are likely to occur.
Answer: D
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If real GDP grows by 3 percent, the velocity of circulation does not change, and the quantity of money grows by 3 percent, then in the long run the inflation rate is
A) 0 percent. B) 6 percent. C) -3 percent. D) -6 percent. E) 3 percent.
Suppose the annual growth rate of real GDP for the nation of Svengali is 5% and the growth rate of velocity is 0%. If the money supply growth rate decreases from 4% to 2%, what is the new rate of inflation in Svengali?
A) -3%. B) -1%. C) 3%. D) 7%.
The classical economists argued that planned saving and planned investment will always be equal because of changes in
A) the level of real disposable income. B) the interest rate. C) the price level. D) wages.
If goods X and Y are complements, then the cross price elasticity of demand between them will be
a. positive. b. negative. c. zero. d. infinity.