What are the costs and benefits of foreign trade?
What will be an ideal response?
Ans: Foreign trade increases market size and welfare of consumers is maximized but side by side, if firms are inefficient, then profits of firms be compromised. BOP would deteriorate and government revenue would also witness fall.
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A ________ externality occurs when a market transaction affects others through market prices
A) positive B) negative production C) negative consumption D) pecuniary
The figure below shows the retail demand for running shoes. If the distributor (the retailer) is a monopoly and the marginal cost of distributing the shoes is $20 per pair, the manufacturer's wholesale demand curve lies
A) $20 below the retail demand curve, D.
B) $20 below the retail marginal revenue curve, MR.
C) $20 above the retail demand curve, D.
D) $20 above the retail marginal revenue curve, MR.
If MPC = 2/3, a decrease in government purchases of $10 billion will ultimately lead to:
a. a $30 billion increase in aggregate demand. b. a $10 billion increase in aggregate demand. c. a $10 billion decrease in aggregate demand. d. a $30 billion decrease in aggregate demand.
Entrepreneurs are more likely to develop among minority groups that have been blocked from traditional high-paying jobs
a. True b. False Indicate whether the statement is true or false