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

question 7

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.

• A) increase; increase; decrease; have no effect on; decrease
• B) decrease; decrease; increase; decrease; have no effect on
• C) increase; have no effect on; decrease; increase; decrease
• D) decrease; increase; decrease; increase; decrease
• E) have no effect on; have no effect on; decrease; increase; decrease

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Definitions:

Accident

An unexpected and unintentional event that typically results in damage or injury.

Guilty

A legal term for a person determined to have committed a crime or a feeling of responsibility for wrongdoing.

Warn

To inform someone of possible dangers or problems, or to advise caution.

Shape Constancy

The perceptual phenomenon where the perceived shape of an object remains constant despite changes in the angle of observation or illumination.