Assume that the United States imposes a quota on Italian shoes. Relative to the equilibrium world price that would exist in the absence of quotas, the equilibrium price of shoes in the United States will most likely _______ , and the equilibrium price of shoes in Italy will most likely _______ .
A) increase; decrease
B) decrease; remain the same
C) decrease; increase
D) increase; remain the same
Ans: A) increase; decrease
You might also like to view...
Assume a closed economy with fixed taxes and the marginal propensity to consume is equal to 0.9. What is the government spending multiplier?
A) 10 B) 9 C) 5 D) 1
The economic justification for public subsidies to university research is based on the
A. value of this research to the university. B. higher salaries graduate students earn as a result of working with professors involved in research. C. external benefits of research and development to, in particular, high rates of economic growth. D. higher incomes earned by those who provide services to university researchers (equipment, supplies, etc.).
Investment and saving are, respectively:
A. income and wealth. B. stocks and flows. C. injections and leakages. D. leakages and injections.
Social Security is structured as a pay-as-you-go system, meaning that payments to current retirees are paid
A) from taxes collected from retired workers. B) as long as the government has funds available. C) from taxes collected from current workers. D) by the Federal Reserve from newly-printed money.