In Great Britain, raising taxes on gasoline has increased the costs of supplying gasoline. As a result, the equilibrium quantity of gasoline ________, and the equilibrium price of gasoline ________
A) increases; rises
B) increases; falls
C) decreases; rises
D) decreases; falls
E) does not change; rises
C
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The gross domestic product (GDP) excludes: a. the value of a new building
b. the value of new stocks and shares. c. the cost of a new vending machine. d. government expenditure on a new bridge. e. the money spent on the purchase of legal services by a household.
Assume that a country imposes a tariff in order to gain a price advantage on an item. What is the typical response from the exporting country?
a. It accepts the situation, and does nothing about it. b. It seeks greater efficiency in order to offset the tariff. c. It refuses to sell to the country that imposes the tariff. d. It retaliates by imposing tariffs or quotas on items from the other country.