Trade restrictions
A. Increase the standard of living for the country as a whole.
B. Reduce the number of hours employees must work.
C. Reduce the gains from trade for the country as a whole.
D. Increase the gains from trade for poor countries.
Answer: C
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Suppose the government imposes a price ceiling on gasoline that is less than the equilibrium price. As a result
A) the price of gasoline rises to the equilibrium price. B) there is incentive for buyers to undertake search activity. C) the supply of gasoline will increase and the supply curve will shift rightward. D) the demand for gasoline will decrease and the demand curve will shift leftward.
A monopolist that is earning economic losses will, in the long run,
a. exit the industry. b. shift it's demand curve rightward. c. stay in the industry, since eventually the price will have to rise. d. encourage competitors to enter the industry in order to enliven it.