Which of the following is true about a lump-sum tariff?
A. Domestic firms' average cost curves are shifted up by the amount of the lump-sum tariff.
B. Foreign firms' marginal cost curves are shifted up by the amount of the lump-sum tariff.
C. Domestic firms' marginal cost curves are shifted up by the amount of the lump-sum tariff.
D. Foreign firms' average cost curves are shifted up by the amount of the lump-sum tariff.
Answer: D
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________ refers to alternating periods of economic expansion and economic recession in an economy
A) Fiscal policy B) Labor productivity C) The business cycle D) Positive economic analysis
Suppose two people with the same level of income and wealth have different discount rates. Joe has a very high discount rate and Jim has a very low discount rate. Which one of the following is TRUE?
A) Joe is more likely to borrow than Jim. B) Joe is less likely to borrow than Jim. C) Joe and Jim will borrow the same amount. D) Neither Joe nor Jim would be borrowers.