Answer: D) removal of the tariff would cause domestic output to fall even further and the price to fall to consumers.
Suppose an industry receives protection from the government in the form of tariffs
A number of years later, it is observed that the quantity supplied by domestic firms had decreased and that the domestic price was substantially greater than the world price. We could conclude that A) the tariff had been imposed to counteract dumping and had been successful.
B) removal of the tariff would actually cause domestic output to increase and price to fall.
C) the tariff had been imposed to protect an infant industry and that the industry still needed protection.
D) removal of the tariff would cause domestic output to fall even further and the price to fall to consumers.
Economics
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A real flow in the circular flow diagram is
i. a firm's payments of wages to its workers. ii. a household's purchase of a new car. iii. a farmer's use of land to grow corn. A) i, ii and iii B) ii only C) ii and iii D) i only E) i and iii
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The law of diminishing marginal returns states that
a. long-run average cost declines as output increases b. if the marginal product is above the average product, the average will rise c. as units of a variable input are added to a given amount of fixed inputs, the marginal product of the variable input eventually diminishes d. as a person consumes more of a good, the marginal satisfaction from that good eventually diminishes e. if marginal product is positive, total product rises
Economics