« previous next »

Author Question: Suppose the current situation is such that the price level is 120, real GDP is 17 trillion, and GDP ... (Read 36 times)

clmills979

  • Hero Member
  • *****
  • Posts: 551
on: Jun 29, 2018
Suppose the current situation is such that the price level is 120, real GDP is 17 trillion, and GDP along the long-run aggregate supply curve is 16.6 trillion. What will take place to restore the long-run equilibrium?
 
  A) The price level will fall until long-run aggregate supply increases to 17 trillion.
  B) The price level will fall and money wage rates will rise until real GDP along the long-run aggregate supply curve is 17 trillion.
  C) Money wage rates will rise until real GDP reaches 16.6 trillion.
  D) Aggregate demand will increase until both short-run and long-run aggregate supply equal 17 trillion.

Question 2

How does a tariff affect the government's revenue? How does an import quota affect the government's revenue?
 
  What will be an ideal response?


mfedorka

  • Sr. Member
  • ****
  • Posts: 324
Reply #1 on: Jun 29, 2018
Answer to Question 1

C

Answer to Question 2

A tariff is a tax on an imported good. Like all taxes, a tariff increases the government's revenue. However, an import quota is quantitative restriction on the amount of a good that can be imported. As such, an import quota has no effect on the government's revenue.


Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
« previous next »
 

Did you know?

The modern decimal position system was the invention of the Hindus (around 800 AD), involving the placing of numerals to indicate their value (units, tens, hundreds, and so on).

Did you know?

Asthma attacks and symptoms usually get started by specific triggers (such as viruses, allergies, gases, and air particles). You should talk to your doctor about these triggers and find ways to avoid or get rid of them.

Did you know?

In 1885, the Lloyd Manufacturing Company of Albany, New York, promoted and sold "Cocaine Toothache Drops" at 15 cents per bottle! In 1914, the Harrison Narcotic Act brought the sale and distribution of this drug under federal control.

Did you know?

Hip fractures are the most serious consequences of osteoporosis. The incidence of hip fractures increases with each decade among patients in their 60s to patients in their 90s for both women and men of all populations. Men and women older than 80 years of age show the highest incidence of hip fractures.

Did you know?

Vaccines cause herd immunity. If the majority of people in a community have been vaccinated against a disease, an unvaccinated person is less likely to get the disease since others are less likely to become sick from it and spread the disease.

Normal development of posture and spinal curves. (A) Toddler: Protruding abdomen; lumbar lordosis. ( Normal development of posture and spinal curves. (A) Toddler: Protruding abdomen; lumbar lordosis. (
The structure of skin (a) and epidermis (b) at the microscopic level. The structure of skin (a) and epidermis (b) at the microscopic level.
Current FDA Pregnancy Category Ratings with Examples Current FDA Pregnancy Category Ratings with Examples
Kyoto Protocol encourages industry to innovate and reduce the level of emissions Kyoto Protocol encourages industry to innovate and reduce the level of emissions
Let A ⊆ R and p ∈ A. Suppose A\{p}6= ∅. Prove that p is an isolated point of A if and ... Let A ⊆ R and p ∈ A. Suppose A\{p}6= ∅. Prove that p is an isolated point of A if and ...
Suppose a country imports televisions. The country's supply and demand curves are shown in ... Suppose a country imports televisions. The country's supply and demand curves are shown in ...
Video: Mycobacterium tuberculosis: Drug Resistance and Natural Selection

For a complete list of videos, visit our video library