Which of the following statements is false?
A) As a result of a quota, consumers' surplus falls.
B) As a result of a tariff, producers' surplus rises.
C) As a result of a tariff, consumers' surplus falls.
D) As a result of a quota, producers' surplus rises.
E) none of the above
E
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If the elasticity of demand for the latest American Idol album is 1.4, this means
A. few substitutes for the American Idol album exist. B. a 10% decrease in the price leads to a 140% increase in quantity demanded. C. a 5% increase in the price leads to a 7% decrease in quantity demanded. D. a 1% increase in the price leads to a 14% decrease in quantity demanded.
An example of an excludable good or service is:
A. national defense. B. a public park. C. ice cream. D. air.
If aggregate expenditures exceed GDP in a private closed economy:
A. leakages will exceed injections.
B. planned investment will exceed saving.
C. unplanned investment in inventories will occur.
D. saving will exceed planned investment.
The income elasticity of demand is:
A. the percentage change in quantity demanded divided by the percentage change in price. B. the percentage change in quantity demanded divided by the percentage change in income. C. the percentage change in income divided by the percentage change quantity demanded. D. the percentage change in price divided by the percentage change in income.