Domestic policies can have unintended effects on international trade
Indicate whether the statement is true or false
TRUE
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Starting from long-run equilibrium, a large tax increase will result in a(n) ________ gap in the short-run and ________ inflation and ________ output in the long-run.
A. recessionary; lower; potential B. expansionary; lower; potential C. expansionary; higher; potential D. recessionary; lower; lower
Anticipating the decisions others will make in response to your decision while knowing the others are anticipating your response is known as
A) strategic interaction. B) the wait-and-see game. C) psychic intuition. D) best-response analysis.
On a production possibilities frontier diagram, where are production points that have tradeoffs? Where are production points with a free lunch?
What will be an ideal response?
As a result of a tariff on good X,
a. domestic producers of good X are better off because they sell more goods at a higher price. b. domestic producers of good X are better off because they sell more goods at the same price. c. domestic producers of good X are better off because they sell the same quantity of goods at a higher price. d. consumers of good X are better off because more domestically produced goods are available.