Explain why tariffs are a primary revenue source for less-developed countries but not for developed countries
What will be an ideal response?
In less-developed countries, it is difficult to monitor things like income and internal transactions, but relatively easier to monitor international transactions. Since monitoring is easier on goods crossing the border, less-developed countries end up generating a large portion of their revenue through tariffs. In developed countries, it is far easier to monitor taxpayer income and, given the far greater revenue potential from taxing income, developed countries are more likely to raise a considerable amount of revenue from income taxes.
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Suppose there is a firm that has no fixed costs. At the point where marginal cost equals average variable cost,
a. fixed cost is rising b. marginal cost is rising c. average total cost is rising d. average variable cost is falling e. there is no total cost
The two types of imperfectly competitive markets are
a. markets with advertising and markets with price competition. b. public goods and common resources. c. oligopoly and monopoly. d. monopolistic competition and oligopoly.
In conducting positive economic analysis, economists apply
A. subjective value judgments. B. the principle of individual sovereignty. C. moral values. D. the scientific method.
Refer to Figure 3. Originally, Ben was producing at his point A and Jerry was producing at his point A. Then, each person decided to specialize in the product in which he has a comparative advantage. Furthermore, they agreed to trade 4 pounds of cones for 2 pounds of ice cream. As a result of these new arrangements, the gains from trade relative to the original situation are as follows:
a. 1 additional pound of cones for Ben and 1 additional pound of ice cream for Jerry.
b. 1 additional pound of ice cream for Ben and 1 additional pound of cones for Jerry.
c. 2 additional pounds of ice cream for Ben and 2 additional pounds of cones for Jerry.
d. 2 additional pounds of ice cream for Ben and 1 additional pound of cones for Jerry.