As a firm in monopolistic competition sets the price for its product, the firm faces a tradeoff between
A) supply and demand.
B) efficiency and equity.
C) internal and external economies of scale.
D) price and the quantity it can sell.
E) its marginal revenue and its price.
D
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Which of the following probably best explains why trade restrictions are imposed even if the costs to consumers are greater than the benefits to protected industries?
a. Indifference on the government's part to the interests of domestic workers b. A desire to make other countries suffer c. Successful lobbying by consumers d. Successful lobbying by employers and workers e. The government's preference to safeguard the interest of the producers at the expense of the consumers
The income effect is the
A) increase in the interest rate caused by an increase in Real GDP. B) increase in the interest rate due to a higher expected inflation rate. C) decrease in the interest rate due to an increase in the supply of loanable funds. D) change in national income brought about by a change in interest rates. E) rate of change in national income brought about by a change in the supply of money.