Which of the following exemplifies why it is unlikely that a country would specialize in just one product?
a. A hurricane late in the growing season destroyed the entire sugar cane crop.
b. Varieties of figs would grow but rarely ripen in the cooler, northern climate.
c. The Playstation video game console sold more units than any other system.
d. Food trends indicated that people were increasing their fruit consumption.
a. A hurricane late in the growing season destroyed the entire sugar cane crop.
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Governments can reduce depletion of resources by restricting access to the resource
Indicate whether the statement is true or false
Which of the following purchases is most likely to rise as the result of a temporary tax cut, according to the permanent-income hypothesis?
A) television sets and other consumer durables B) steak dinners and other consumer non-durables C) trips to the Virgin Islands and other vacation destinations D) theater tickets and other entertainment expenditures
If asked to comment about a new tax on cotton collected from growers who do not grow their plants in the shade of other plants, an economist with no particular expertise in cotton growing might still note that
a. the price received by these cotton producers will fall by the full amount of the tax. b. the price paid by consumers of this cotton will rise by the full amount of the tax. c. the legal incidence of the tax does not determine who bears the burden of the tax. d. the tax was imposed on the wrong party, it should have been placed on buyers.
If a contestable market has only one seller, which of the following will keep the seller from producing inefficiently and charging a price that generates long-run economic profits?
a. government regulations b. low costs of entry into and exit from the market c. substantial economies of scale that provide a competitive advantage to large firms in such markets d. the threat of a government takeover of the firms in these markets