Which of the Following Statements Is Correct? Most Economists

question 79

Multiple Choice

Which of the following statements is correct? Most economists

• A)think that protectionism is a vital and necessary component in a nation's economic policy.
• B)prefer to let the market forces of supply and demand solve trade imbalances.
• C)believe that tariffs and quotas are efficient and effective measures.
• D)believe product standards,export subsidies,and exchange controls are desirable trade practices,but quotas and tariffs only provoke retaliation.
• E)think that the best way to correct trade deficits is to devalue the dollar.

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Definitions:

P > ATC

A scenario in which the price of a good is greater than the average total cost of producing that good, indicating potential profitability for the firm.

Short Run

A period in economic analysis where at least one input is fixed while others can be varied.

Monopolistically Competitive Market

A monopolistically competitive market is a type of market structure characterized by many firms selling products that are similar but not identical, allowing for product differentiation.

Monopolist

A sole provider of a product or service in a market, holding significant market power.