Which of the following describes the general effect of tariffs on consumer surplus as shown in Exhibit 1?
a. eliminated
b. unchanged
c. decreased
d. increased
c. decreased
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Sam's production possibilities frontier has good A on the horizontal axis and good B on the vertical axis. If Sam is producing at a point inside his frontier, then he
A) can increase production of both goods with no increase in resources. B) is fully using all his resources. C) values good A more than good B. D) values good B more than good A.
The organization formed to allow governments to borrow to stabilize exchange rates is the
a. International Trade Commission b. World Trade Council c. United Nations' Economic Development Council d. International Monetary Fund e. World Bank
Suppose Congress passes an investment tax credit that increases the quantity of investment goods that firms demand at any given interest rate. Which of the following would you expect to occur as a result of this change?
a. In the short run, unemployment will increase and inflation will fall. b. In the short run, unemployment will increase and inflation will rise. c. In the short run, unemployment will decrease and inflation will rise. d. In the short run, unemployment will decrease and inflation will fall.
Suppose there is a simultaneous fiscal expansion and monetary expansion. We know with certainty that
A) output will increase. B) output will decrease. C) the interest rate will increase. D) the interest rate will decrease. E) both output and the interest rate will increase.