The infant industry argument for tariffs against free trade is sometimes supported because:
A) it is very hard to discern which industries really deserve protection.
B) subsidies may have more merit than tariffs.
C) the "infant" may "still wear diapers" even after it attains a huge size and economies of scale.
D) a new domestic industry may have potential economies of scale.
Ans: D) a new domestic industry may have potential economies of scale.
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The cross-price elasticity of demand between two goods that are substitutes can never be:
A. greater than one. B. positive. C. negative. D. less than one.
Employment discrimination is a source of
A. economic inefficiency. B. increased economic growth. C. innovation. D. shifting production possibilities. E. All of the responses are correct.
According to the classical growth theory of Thomas Malthus
A) labor productivity increases continuously. B) the population growth rate is fixed. C) technological advances lead to permanent increases in real GDP per person. D) increases in real GDP per person are only temporary.
A delivery company lowers its automobile insurance costs as it increases in size because as the size of the fleet of delivery trucks increases, the premium per driver decreases substantially. This is an example of
A. economies of scale. B. constant returns to scale. C. diseconomies of scale. D. diminishing marginal returns.