Refer to the graph shown for a small country that is a price taker internationally.
Assume the foreign supply of this product is perfectly elastic at a price of $4 per unit. Starting from a free trade equilibrium, a tariff in the amount of $2 per unit would be expected to cause domestic consumption to:
A. decrease from 7,400 to 6,100.
B. decrease from 4,800 to 3,600.
C. increase from 2,400 to 7,400.
D. increase from 2,400 to 3,600.
Answer: A
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Which of the following would NOT tend to increase the buying price in an oligopsony?
A) More buyers in the market B) Collusion among the buyers C) More elastic supply D) Rightward shift in the MV curve
One thing that is not true about cooperatives is that they
a. put out raw materials, like wool and cotton, to rural households that turn it into finished products b. pool resources to buy and sell more efficiently c. try to minimize costs d. operate with limited liability of members e. enjoy tax-exempt status
Whatever serves as a medium of exchange is: a. money
b. money, as long as it is also the best such medium of exchange available. c. money, as long as it is not also a commodity. d. money, as long as it is not also legal tender. e. not money, unless it continues to be backed by its issuing institution.
If the market supply curve does not capture all of the costs to society of producing an additional unit of good, then:
A. the allocation of resources will be efficient. B. the market equilibrium will be socially optimal. C. the market equilibrium will not be efficient. D. the market will not be in equilibrium.