If antitrust legislation is successful, then the monopolistic firm will
A) decrease output and charge a lower price than before.
B) increase output and charge a higher price than before.
C) increase output and charge a lower price than before.
D) decrease output and charge a higher price than before.
Answer: C
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The U.S. Customs Service reclassified imports of compact trucks (like the Toyota Tacoma) from "cab and chassis with some final assembly needed" to "complete or unfinished trucks." As a result of this reclassification, a tariff of _____ was applied, and U.S. prices of Japanese compact trucks rose by _____.
a. 25%; 25% b. 25%; more than 25% c. 25%; less than 25% d. 4%; more than 4%
As shown by the IS-LM model, there are two reasons that the Fed can lose control of the economy. One of these reasons is
A) federal funds rate can never reach zero percent. B) zero federal funds rate is not sustainable. C) household and business borrowers do not base their decision to borrow on interest rates. D) that the zero federal funds rate achieved by the Fed is irrelevant to household and business borrowers.