If the home nation allows free trade but imposes a tariff on a product currently produced by a home firm monopoly, what is the outcome?
a. The home firm then will regain its monopoly control over the price.
b. The home firm will be able to charge a higher price (world price + tariff), but it will become a price taker, just like a competitive firm.
c. The home nation's firm will be able to limit quantity and charge a higher price.
d. The monopoly firm will lower price, increase sales, and undercut the foreign competition.
Ans: b. The home firm will be able to charge a higher price (world price + tariff), but it will become a price taker, just like a competitive firm.
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There are currently N identical firms in a market. If it is a perfectly competitive market, the short-run market supply curve at any given price is
A) N times the supply of an individual firm. B) N - 1 times the supply of an individual firm. C) N plus the supply of an individual firm. D) It cannot be determined from the information provided.
Suppose an economy has 90,000 employed persons and 10,000 unemployed persons, the unemployment rate is
a. 11.1% b. 10.0% c. 5.6% d. 12.5% e. 9.1%
An increase in the world price of oil will result in ________.
What will be an ideal response?