A high tariff on imported good X might reduce domestic employment in industry Y if:
A. X is an input used domestically in producing Y.
B. X and Y are substitute goods.
C. X is an inferior good.
D. Y is an inferior good.
A. X is an input used domestically in producing Y.
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If the consumption function is C = 90 + 0.75y, then the marginal propensity to save is
A) 0.25. B) 0.75. C) 67.5. D) 90.
Suppose the price of gasoline in July 2004 averaged $1.35 a gallon and 15 million gallons a day were sold. In October 2004, the price averaged $2.15 a gallon and 14 million gallons were sold
If the demand for gasoline did not shift between these two months, use the midpoint formula to calculate the price elasticity of demand. Indicate whether demand was elastic or inelastic.
Laws that change the tax code must begin
A. with the President. B. in the House of Representatives. C. in the Senate. D. none of these, they may begin anywhere.
A decrease in price:
A. does not change quantity demanded if demand is elastic. B. does not cause a quantity effect when demand is perfectly inelastic. C. causes a decrease in total revenue due to the quantity effect. D. causes an increase in total revenue due to the price effect.