Which of the following would be expected if the tariff on foreign-produced automobiles were increased?
A. The domestic price of automobiles would fall.
B. The supply of foreign automobiles to the domestic market would decline, causing auto prices to rise.
C. The number of unemployed workers in the domestic automobile industry would rise.
D. The demand for foreign-produced automobiles would increase, causing the price of automobiles to increase in other nations.
Answer: B
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Refer to Table 2-9. Does either Japan or Thailand have an absolute advantage and if so, in what product?
A) Thailand has an absolute advantage in rice. B) Japan has an absolute advantage in wristwatches. C) Japan has an absolute advantage in rice. D) Thailand has an absolute advantage in both products.
In a monopolistically competitive market: a. there are significant barriers to the entry of new sellers. b. firms sell differentiated products
c. firms face horizontal demand curves. d. there are a few producers selling standardized products.
Ricky leaves his job as a high school math teacher and returns to school to study the latest developments in computer programming, after which he takes a higher paying job at a software firm. This is an example of
a. A compensating differential. b. Human capital. c. Signaling. d. Efficiency wages
Suppose when a market has four firms, average economic profit is $1,000 per month. When the market has five firms, the average economic profit is -$50 per month. This suggests that
A) the long-run equilibrium number of firms is between four and five. B) the long-run equilibrium number of firms is four. C) the long-run equilibrium number of firms is five. D) there is no long-run equilibrium in this market as profits can never be zero.