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If an Import-Competing Firm Is Imperfectly Competitive, Than Under Free

question 59

Multiple Choice

If an import-competing firm is imperfectly competitive, than under free trade an import quota will ________ domestic market price, ________ producer surplus, ________ consumer surplus, ________ government revenue, and ________ overall domestic national welfare.


Definitions:

ATC

Average Total Cost (ATC) refers to the total cost per unit of output produced, comprising both fixed and variable costs.

Variable Costs

Costs that change in proportion to the level of activity or volume of output in production.

Fixed Costs

Business expenses that remain constant regardless of the level of production or sales, such as rent or salaries.

Average Total Cost

The total cost divided by the number of units produced, calculating the cost to produce an average unit of output.

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