A consumer can purchase a product that is outside her or his budget constraint if it is on a higher indifference curve.
Answer the following statement true (T) or false (F)
False
A consumer cannot purchase any good that is outside the budget constraint; it is unaffordable. The rational consumer will purchase a combination of goods that lies on the budget constraint but meets the highest indifference curve, or highest utility.
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Which of the following is likely to happen if the government increases its expenditure?
A) Price level will fall. B) Investment will decrease. C) Unemployment will increase. D) Consumption will increase.
In an inflationary environment, then over time
A) a specific tariff will tend to raise more revenue than an ad valorem tariff. B) an ad valorem tariff will tend to raise more revenue than a specific tariff. C) an optimum tariff will tend to raise more revenue than an escalating tariff. D) a tariff quota will tend to raise more revenue than a specific tariff. E) an import quota would raise more revenue than a specific tariff.
The Clayton Act was passed in
a. 1887 b. 1890 c. 1914 d. 1936 e. 1952
The figure below shows the national market for mopeds in a small country. Dd and Sd are the domestic demand and supply curves of mopeds, respectively.
The figure below shows the marginal external benefit curve (MEB) of the country from the domestic production of mopeds.
The overall impact of the tariff on the nation would be
A. a gain of $5.75 million. B. a loss of $20.75 million. C. a loss of $15 million. D. a gain of $13.25 million.