Which of the following would be expected if the tariff on foreign-produced shoes were decreased?
a. The domestic price of shoes would fall.
b. The supply of foreign shoes to the domestic market would decline, causing shoe prices to rise.
c. The number of unemployed workers in the domestic shoe industry would decline.
d. The demand for foreign-produced shoes would decrease, causing the price of shoes to increase in other nations.
Ans: a. The domestic price of shoes would fall.
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The Federal Reserve System first began operations in:
A. 1865. B. 1914. C. 1789. D. 1934
One of the chief advantages of exchange rate pegging is that ________
A) a country is able to pursue an independent monetary policy over the course of the business cycle B) it can be an effective means of reducing inflation C) the currency can be used to promote export growth D) it allows the monetary authorities to actively respond to the problems of inflation and unemployment
If the central bank follows a monetary policy in which it maintains a fixed interest rate, then
a. the LM curve will get steeper. b. the IS curve will get steeper. c. the LM curve will become vertical. d. the LM curve will become horizontal. e. none of the above.
The margin requirement is the maximum percentage of the price of a(n)
a. bond that can be used as collateral to borrow from a bank b. investment good that can be used as collateral to borrow from a bank c. home mortgage that can be used as collateral to borrow from a bank d. stock that can be used as collateral to borrow from a bank e. an asset that can be used as collateral to borrow from the Fed