Most economists believe that the infant industry argument for protection, though theoretically justified, often keeps firms from becoming more competitive.
Answer the following statement true (T) or false (F)
True
Infant industries often become dependent on protection, and so they often do not grow up to be efficient or competitive.
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Under the unified Euro regime, the European countries control
A) fixed exchange rate only. B) monetary policy oriented toward domestic goals only. C) freedom of international capital movements only. D) monetary policy oriented toward domestic goals and freedom of international capital movements. E) fixed exchange rate and freedom of international capital movements.
With what measure does cyclical unemployment tend to move?
A. Per capita GDP growth rate B. Nominal GDP C. Inflation D. GDP deflator
Unlike a perfectly competitive firm, a monopolistically competitive firm
a. faces a perfectly inelastic demand curve. b. can earn positive economic profit in the short run and in the long run. c. cannot earn positive economic profit even in the short run. d. has a negatively sloped demand curve.
The self-correcting tendency of the economy means that rising inflation eventually eliminates:
A. unemployment. B. exogenous spending. C. recessionary gaps. D. expansionary gaps.