One reason economists oppose trade restrictions is that:
A. no nation can benefit from trade restrictions.
B. they protect national security, particularly in wartime.
C. it is difficult to limit trade restrictions to instances when their use is justified.
D. they are an ineffective way to raise tax revenue.
Answer: C
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Refer to Figure 13-16. Figure 13-16 depicts a monopolistically competitive barber shop. Use the diagram to answer the following questions
a. Suppose the average variable cost of production is $15 when output equals 110 haircuts and $15.25 when output equals 140 haircuts. If the firm wants to maximize its profit or minimize its losses, how many haircuts will it produce and what price should it charge? Explain your answer. b. Calculate the firm's profit or loss. c. What is likely to happen in this industry over time as it moves to its new long-run equilibrium? d. Suppose the barber shop depicted in the diagram remains in the industry. Is this barber shop likely to produce this same quantity of haircuts as in part (a) in the long run?
Empirically, there is a close positive relationship between domestic savings and investment. This is consistent with what we should expect to observe in
a. a closed economy. b. the Mundell-Flemming model with perfect capital mobility. c. the Mundell-Flemming model with perfect capital mobility and flexible exchange rates. d. the Mundell-Flemming model with perfect capital mobility and fixed exchange rates. e. none of the above.
If Country A exports a good to Country B, who is made better off?
a. The producers in Country A and the consumers in Country B b. The consumers in Country A and the consumers in Country B c. The producers in Country A and the producers in Country B d. The consumers in Country A and the producers in Country B e. Only the consumers in Country A will benefit from this trade agreement
The original goal of the Fed's founders was to prevent the
a. supply of money from increasing too rapidly. b. supply of money from decreasing during downturns. c. possibility of hyperinflation. d. possibility of interest rates falling too rapidly.