If the United States unilaterally removed all of its trade restrictions and moved toward a policy of free trade, international trade theory indicates that
a. U.S. residents would gain, but people in other countries would be worse off.
b. people in other countries would gain, but U.S. residents would be worse off.
c. both U.S. residents and people in other countries would be able to achieve higher income levels.
d. the average income level would be lower in both the United States and other countries.
C
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________ natural monopolies is a commonly used, potential solution to the problems presented by natural monopolies
A) Breaking up firms that are B) Regulating C) Outlawing price discrimination by D) Refusing to grant patents to E) Giving incentives to firms to become
Refer to Figure 3-5. In a free market such as that depicted above, a shortage is eliminated by
A) a price decrease, decreasing the supply and increasing the demand. B) a price increase, increasing the quantity supplied and decreasing the quantity demanded. C) a price increase, increasing the supply and decreasing the demand. D) a price decrease, decreasing the quantity supplied and increasing the quantity demanded.