Which of the following situations will arise in the domestic market following the imposition of a tariff?
A) imports decrease, domestic production increases, prices decrease
B) imports decrease, domestic production increases, prices increase
C) imports increase, domestic production decreases, prices decrease
D) imports increase, domestic production increases, prices increase
B
You might also like to view...
The iconic American drink-maker, Coca-Cola, announced plans in 2008 to buy the dominant Chinese fruit juice company for $2.5 billion. But China just rolled out a new law to guard against business monopolies
How would this rent-seeking behavior by Coca-Cola most likely affect efficiency in the drink market? A) Profit would increase. B) Producer surplus would increase. C) Consumer surplus would decrease. D) Deadweight loss would increase.
Describe the state of affairs in the developing world concerning social overhead capital?
What will be an ideal response?
We can draw demand curves for firms in perfectly competitive and monopolistically competitive industries, but not for oligopoly firms. The reason for this is
A) perfectly competitive and monopolistically competitive firms sell standardized products. Oligopoly firms sell differentiated products. B) there are no barriers to entry in perfectly competitive and monopolistically competitive industries. There are high barriers to entry in oligopoly industries. C) we can assume that the prices charged by perfectly competitive and monopolistically competitive firms have no impact on rival firms. For oligopoly this assumption is unrealistic. D) that perfectly competitive and monopolistically competitive firms are price takers. Oligopoly firms are price makers.
Governments may successfully intervene in competitive markets in order to achieve economic efficiency
A) at no time; competitive markets are always efficient without government intervention. B) to increase the incidence of positive externalities. C) in cases of positive externalities only. D) in cases of negative externalities only. E) in cases of both positive and negative externalities.