Suppose Ukraine subsidizes Ukrainian wheat farmers, while Russia offers no subsidy to Russian wheat farmers. As a result of the Ukrainian subsidy, sales of Ukrainian wheat to Russia
a. may prompt Russian farmers to invoke the infant-industry argument.
b. increase the consumer surplus of Russian buyers of wheat.
c. decrease the total surplus of the Russian people.
d. All of the above are correct.
b
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Assuming all excess reserves are loaned out, currency holdings by the public are zero, and a reserve ratio of 25 percent, an initial deposit of $3,000 will lead to a total increase in deposits of
A) $750. B) $2,250. C) $12,000. D) $36,000.
Suppose that real GDP grows at 3 percent per year. What is the growth rate of real GDP per person if the population grows at:
a. 2 percent? What happens to the standard of living? b. 3 percent? What happens to the standard of living? c. 4 percent? What happens to the standard of living?
A beekeeper decides to locate her business on a plot of land that lies between an apple orchard and an elementary school. Which of the following is a positive externality that can result from the business?
a. The cost of the beehives to the beekeeper b. The possibility of the bees stinging the students at the school c. The bees helping to pollinate the orchard, leading to more fruit production d. The honey that is produced by the bees
If two firms form a successful cartel, then the output that the two produce in total will
A. be equal to the output in perfect competition. B. be equal to the output of a monopoly market. C. be greater than the output without the cartel. D. be the same as if the market had many firms.