A monopsony restricts the quantity of a factor demanded to force down the price of the factor and increase profits
Indicate whether the statement is true or false
TRUE
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Product differentiation
A) is possibly welfare enhancing if new products match consumer preferences better. B) is welfare reducing even if new products match consumer preferences better. C) is welfare enhancing even if new products do not match consumer preferences better. D) is welfare reducing even if new products do not match consumer preferences better.
If actions by the President and Congress reduce the federal government budget deficit, then interest rates will _____, the U.S. dollar will _____, and the foreign trade deficit will _____
a. increase; appreciate; increase b. increase; depreciate; increase c. decrease; appreciate; decrease d. decrease; depreciate; increase e. decrease; depreciate; decrease
How does the imposition of a tariff reduce the price of imports?
a. At the lower quantity supplied, the price to the importer is lower than if there were free trade. b. At the lower quantity demanded, the price to the importer is lower than if there were free trade. c. Supply of the product is increased from domestic production, reducing the price of the imports. d. Demand for the product is decreased, so that price must fall.
In the 1980s, both the U.S. government budget and U.S. trade deficits increased
a. True b. False Indicate whether the statement is true or false