Explain the three distinct notions of openness
What will be an ideal response?
There are three notions of openness. First, there is openness in the goods market where agents buy domestic and foreign goods and domestic firms sell goods abroad. Second, there is openness in financial markets where individuals can purchase, for example, domestic or foreign bonds. And third, there is openness in factor markets where firms can locate either domestically or in other countries. Workers can also move between countries.
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In the above figure, as the y variable increases,
A) the x variable is constant. B) the x variable increases. C) the x variable decreases. D) the x variable at first increases but then decreases. E) the x variable probably changes, but more information is needed to determine if it increases, decreases, or stays the same.
At the current price of a good, Al's consumer surplus equals eight, and Ben's consumer surplus equals 15. By charging a two-part tariff, a monopolist could increase his profit by
A) 8. B) 16. C) 15. D) 30.