A country with a strong bargaining power is likely to direct the terms of trade in its favor

If the tariffs on textiles, apparel items, and footwear mentioned in the Application were replaced by equivalent voluntary export restraints (VERs), who would benefit the most?

A) the U.S. government B) high-income consumers C) low-income consumers D) the foreign manufacturer

To achieve long-run equilibrium in an economy with a recessionary gap, without the use of stabilization policy, the inflation rate must:

A. not change. B. increase. C. decrease. D. either increase or decrease depending on the relative shifts of AD and AS.