Of the following, who gains because of tariffs and why?
A) domestic producers of protected goods because they can sell at a higher price
B) domestic buyers because they can be sure of buying high-quality products
C) foreign producers because they earn more total revenue
D) foreign government because they gain more revenue
E) domestic buyers because they pay a lower price
A
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Suppose the demand curve for a product is downward sloping and the supply curve is upward sloping. If a unit tax is imposed in the market for this product
A) the tax burden will be shared among the government, buyers and sellers. B) buyers bear the entire burden of the tax. C) the tax burden will be shared by buyers and sellers. D) sellers bear the entire burden of the tax.
________ refers to the irregular meetings of creditor governments with debtor nations desiring rescheduling of debts
A) The Paris Club B) IMF "conditionality" C) IBF D) LIBOR
A tax may be used as a corrective device in the case of a negative externality because it will __________ marginal private costs and __________ supply.
A. increase; decrease B. increase; increase C. decrease; decrease D. decrease; increase
In the employment of any resource, a firm should
A) equate marginal revenue product with the cost of the additional resource. B) hire each input unit that adds more to revenue than it adds to costs. C) hire each input unit provided its marginal physical product is greater than zero. D) A and B are both correct.