Which of the following is not an argument favoring tariffs?
a. They help infant industries grow
b. They increase consumer surplus for domestic consumers.
c. They reduce domestic unemployment.
d. They are necessary for national security reasons.
b
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Suppose a monopoly firm has an annual demand function of Qd = 20,000 - 250P, annual variable costs of VC = 16Q + 0.002Q2 and marginal cost of MC = 16 + 0.004Q, where Q is the annual quantity of output. In addition, the firm has an avoidable fixed cost of $25,000 per year. If this firm maximizes its profit, what is the value of its producer surplus?
A. $156,500 B. $181,500 C. $242,000 D. $217,000
The Prisoners' Dilemma is a particular type of game in which negotiation and enforcement of binding contracts is not possible, and such games are known as:
A) cooperative games. B) noncooperative games. C) collusive games. D) Cournot games.
If firms enter a purely competitive industry, then in the long run this change will shift the industry:
A. demand curve to the right, and the market price will increase. B. supply curve to the left, and the market price will increase. C. demand curve to the left, and the market price will decrease. D. supply curve to the right, and the market price will decrease.
The international adjustments, which will help the U.S. economy out of a structural stagnation, include:
A. running expansionary policies to shift the aggregate demand curve to the right. B. hiring workers in the government sector to boost employment. C. depreciating the value of the dollar. D. extending unemployment compensation to replace income for unemployed workers.