A real cost of tariffs and quotas that is difficult to measure is that they
A) encourage rent seeking.
B) shift income from consumers to producers.
C) limit the quantity of imports.
D) reduce wages.
E) cause deflation.
A
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Refer to the scenario above. Suppose the cost of advertising in this industry is very high and each company will incur a cost of $3 million annually if they choose to advertise. Which of the following is true in this case?
A) Company A's best response is to advertise if Company B advertises. B) Company B's best response is to advertise irrespective of what Company A does. C) Company A's dominant strategy is to advertise. D) This game does not have a dominant strategy equilibrium.
Which of the following predictions can be made using the growth rates associated with the quantity equation, assuming velocity is stable?
A) If the money supply grows at a faster rate than real GDP, there will be inflation. B) If the money supply grows at a slower rate than real GDP, there will be inflation. C) If the money supply grows at the same rate as real GDP, the price level will be fall and there will be deflation. D) If the money supply grows at the same rate as real GDP, the price level will also increase at the same rate as real GDP.