Suppose initially there is no customs union and that the $100 tariff is imposed by the United States. Now, Mexico invests in productive technology and it shifts the Mexican supply curve to SMex. The United States now forms a customs union with Mexico. This will result in a price of _______ and imports of _______.

The supply-side effects of an income tax cut ________ potential GDP and ________ aggregate supply

A) increases; do not change B) increase; increase C) decrease; increase D) decrease; decrease E) increase; decrease

The term ceteris paribus is an economic assumption that means

A) let the buyer beware. B) common sense is reality. C) the detail is in the interrelationship. D) other things being equal.