A tariff on a product
a. enhances the economic well-being of the domestic economy.
b. increases the domestic quantity supplied.
c. increases the domestic quantity demanded.
d. results in an increase in producer surplus that is greater than the resulting decrease in consumer surplus.
b
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If Finland has an absolute advantage in the production of two goods compared to Latvia, Finland can still benefit from trade with Latvia
Indicate whether the statement is true or false
When the price of a good changes, the substitution effect can be found by comparing the equilibrium quantities purchased
A) on the old budget line and the new budget line. B) on the original indifference curve when faced with the original prices and when faced with the new prices. C) on the new budget line and a hypothetical budget line that is a shift back to the original indifference curve parallel to the new budget line. D) on the new indifference curve.
Suppose you place $500 into a savings account that will pay you 6% interest per year. What will be the future value of the savings account in 15 years?
Accounting profits at a firm's break-even point are
A. negative. B. zero. C. positive. D. indeterminate since we need to know what demand is.