Which of the following statements is true?
A) The U. S. economy would gain from the elimination of its tariffs but not from the elimination of its quotas.
B) The U.S. economy would gain from the elimination of tariffs and quotas even if other countries do not reduce their tariffs and quotas.
C) Economic efficiency would be increased if the United States eliminated all of its trade restrictions, but only if all other countries eliminated their trade restrictions too.
D) Eliminating its tariffs and quotas unilaterally would not benefit the United States because this would remove the leverage it would have to persuade other countries to eliminate their trade restrictions.
B
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Industrial production, total sales, nonfarm employment, and after-tax household income are examples of ________ indicators of economic activity.
A. coincident B. real C. preceding D. lagged
The statement “Resources employed in producing X are better suited to making Y” is another way of saying resources
A. are specialized. B. are scarce. C. are used inefficiently. D. are unproductive. E. have no opportunity cost.
For the CPI to provide an accurate measure of the prices paid by urban consumers, it is necessary to
A) have a market basket that is consistent and corresponds to what households actually purchase. B) make certain that the incomes of the consumers surveyed do not change because such a change would affect the market basket of the goods and services they buy. C) change the market basket each month to reflect the changes that consumers make. D) assign equal weights to all the goods and services included in the market basket surveyed so that nothing is over-weighted. E) have prices stated in dollars so consumers can compare what they spend.
Which of the following is an example of a leakage into the circular flow of income and expenditure?
a. Saving b. Exports c. Government expenditure on goods d. Transfer payments e. Investment by firms