Which of the following is an unintended side effect of protectionist policies to protect domestic jobs?
a. The consumers are paying higher prices to the protected industry, so they will purchase less product from that industry, and jobs are lost in the protected industry.
b. The protected product is sold to other firms, who must now pay a higher price for a key input, so those firms will lose sales to foreign producers who do not need to pay the higher price.
c. The protected product is sold to other firms, who must now pay a higher price for a key input, so those firms will increase sales from foreign producers.
d. The consumers are paying higher prices to the protected industry, so they will purchase more products from unprotected industries, and jobs are gained in the unprotected industry.
b. The protected product is sold to other firms, who must now pay a higher price for a key input, so those firms will lose sales to foreign producers who do not need to pay the higher price.
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In the above table, which technique is technologically inefficient?
A) Technique W B) Technique X C) Technique Y D) Technique Z
A key contribution of Ronald Coase is that he pointed out that private transactions are efficient when the number of parties involved is small
A) and when property rights are well defined and transactions costs are low. B) and when property rights do not exist. C) and that property rights are irrelevant to the existence of externalities. D) and when corporations are not greedy.
If the government removes a tax on a good, then the quantity of the good sold will
a. increase. b. decrease. c. not change. d. All of the above are possible.
If supply increases and demand decreases, the new equilibrium price will be ________ and the new equilibrium quantity will be ________.
A. lower; lower B. higher; uncertain C. lower; uncertain D. higher; higher