If the supply curve is perfectly inelastic and the demand curve is a downward sloping straight line, what is the effect of a consumer ad valorem tax on equilibrium price and quantity?
A) Price remains unchanged and quantity increases.
B) Price decreases and quantity increases.
C) Price decreases and quantity remains unchanged.
D) Price and quantity decrease.
C
Economics
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Frequently, politicians enact restrictive trade policies to protect domestic industries. How does economic theory predict this will affect the efficiency of economic organization?
Economics
In the long run, firms in many industries often experience falling average total costs as a result of
a. gains through trade. b. increasing marginal returns. c. economies of scale. d. lower fixed costs.
Economics