According to public choice theory, tariffs, quotas, and other trade restrictions are primarily the result of the
a. political clout of foreigners.
b. political clout of domestic consumers.
c. political power of special interest groups.
d. political desire for economic efficiency.
C
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The supply of a good will tend to be highly elastic if
A) additional resources to produce the good can be obtained quickly and with no increase in cost. B) its price rises quickly and sharply when the demand increases. C) the good has few close substitutes. D) the good is generally classified as a luxury. E) the good is generally classified as a necessity.
Refer to Table 4-7. Suppose that the quantity of labor demanded increases by 40,000 at each wage level. What are the new free market equilibrium hourly wage and the new equilibrium quantity of labor?
A) W = $12.50; Q = 630,000 B) W = $8.50; Q = 550,000 C) W = $11.50; Q = 610,000 D) W = $9.50; Q = 570,000