ECON 2306 Exam 4; Final
A purely competitive firm will be willing to produce at a loss in the short run provided: A. The loss is no greater than its total variable costs B. The loss is no greater than its marginal costs C. The loss is no greater than its total fixed costs D. Price exceeds marginal costs
A
A straight-line downward-sloping demand curve has a price elasticity of demand which: A. decreases as price decreases. B. increases as price decreases. C. is zero at all prices. D. is unitary at all prices.
A
An economy is producing at the least-cost rate of production when: A. Price and the minimum average cost are equal B. Marginal cost is greater than average total cost C. Marginal revenue is greater than price D. Price and marginal revenue are equal
A
If the supply of labor in a purely competitive labor market decreases, the labor: A. Supply curve for a single employer will shift downward B. Supply curve for a single employer will shift upward C. Demand curve for a single employer will shift upward D. Demand curve for a single employer will shift downward
b
In 2009, an unattached individual would be defined as living in poverty if his or her income was less than: A. $9,800 B. $10,956 C. $11,654 D. $14,726
b
It is the custom for paper mills located alongside the Layzee River to discharge waste products into the river. Operators of hydroelectric generating plants on the river find that they must clean up the river's water before it flows through their equipment. This situation is an example of: A. an external economy. B. a spillover cost. C. the exclusion principle. D. a spillover benefit.
b
Other things being equal, the demand for a factor of production will be less elastic if the demand for the final product it produces is: A. Elastic B. Inelastic C. Unitary elastic D. Perfectly elastic
b
Assume that there is no way to prevent someone from using an interstate highway, regardless of whether or not he or she helps pay for it. This characteristic is associated with: A. rival goods. B. complementary goods. C. public goods. D. capital goods.
c
Which statement applies to the Social Security system? A. Benefits are paid on the basis of need B. It provides cash assistance and services to families with dependent children C. It is financed by payroll taxes on employees and employers D. Benefit levels vary throughout the nation because the system is administered by the individual states
c
The difference between the actual price that a producer receives and the minimum acceptable price a producer is willing to accept is: A. The consumer surplus B. The producer surplus C. Allocative efficiency D. Productive efficiency
Actual versus minimum price will accept; producer surplus (area of difference). Actual versus max price (area) consumer surplus. Combination of the two surpluses= Total welfare -Supply vs Demand curve
About what percentage of the population in the United States lived in poverty in 2009? A. 14 percent B. 24 percent C. 34 percent D. 44 percent
a
Government programs that pay benefits to those who are unable to earn income because of permanent handicaps or to those who have very low incomes are called: A. Public assistance programs B. Social insurance programs C. Affirmative action programs D. Entitlement programs
a
Near an ocean beach, a high-rise building is being constructed that will block the scenic view of the ocean by the residents of a low-rise building. The Coase theorem suggests that this type of dispute between the owners of high-rise and low-rise buildings would best be resolved by A. the owners themselves. B. city government officials. C. a zoning ordinance restricting high-rise buildings. D. a government fine for the builder of the high-rise.
a
Suppose that Teresa Thomas obtains 12 units of utility from the last dollar of income received by her, while Richard obtains 7 units of utility from the last dollar of his income. Those who: A. Favor an equal distribution of income would advocate redistributing income from Richard to Teresa B. Favor an equal distribution of income would advocate redistributing income from Teresa to Richard C. Favor an equal distribution of income would be content with the distribution of income between Teresa and Richard D. Do not favor an equal distribution of income would argue that any redistribution between Teresa and Richard would increase total utility
a
Which statement is true? A. Monopoly will result in a higher price and a larger output than pure competition B. Monopoly will result in a higher price and a larger output than monopolistic competition C. Pure competition will result in a lower price and a higher output than monopolistic competition D. Monopolistic competition will result in a lower price and a lower output than pure competition
c
Which would result in a decrease in the elasticity of demand for a particular resource? A. A decrease in the rate at which the marginal product of that resource declines B. An increase in the elasticity of demand for the product that the resource helps to produce C. A decrease in the percentage of the firm's total costs accounted for by the resource D. An increase in the substitutability of other resources for the particular resource
c
About how many nations belong to the World Trade Organization? A. 35 B. 72 C. 151 D. 210
c (152)
"Rivalry" (in consumption) means that: A. There are multiple sellers of the good. B. There are many buyers of the good. C. A buyer may purchase goods from multiple sellers. D. When one person buys a good, it is not available for another person to buy.
d
A Lorenz curve shows: A. The tax and transfer trade-off B. How many households are living in poverty C. Perfect income equality D. The distribution of income
d
A decrease in the supply curve for nurses could be accounted for by all of the following except a(n): A. Increase in the rewards available in other comparable occupations B. Increase in the training required for nurses C. Reduction in the number of nursing schools D. Cut in the wages of nurses
d
An example of a public assistance program, as distinct from a social insurance program, would be: A. Medicare B. Social Security C. Unemployment compensation D. Supplemental Security Income
d
An oligopolistic market is consistent with: A. All firms making economic profits B. A small number of firms in the industry C. The existence of barriers to entry D. All of the above
d
Collusive control over price may permit oligopolists to: A. Use new technology, achieve economies of scale, and get government subsidies B. Achieve economies of scale, reduce costs, and prevent price cheating C. Increase product demand, increase product supply, and lower cost D. Reduce uncertainty, increase profits, and possibly limit entry of new firms
d
Complete income inequality using the Gini ratio would be reflected by a value of: A. 2 B. 3 C. 0 D. 1
d
Government programs that replace earnings lost when people retire or are temporarily unemployed would be considered to be: A. Noncash transfers B. An earned-income tax credit C. Part of public assistance programs D. Part of social insurance programs
d
Government programs, such as Social Security, food stamps, AFDC, SSI, Medicare, and Medicaid, that guarantee particular levels of transfer payments to all who fit the programs' criteria are called: A. Public assistance programs B. Social insurance programs C. Benefit-reduction programs D. Entitlement programs
d
If output is set at the kink of the kinked demand model, then there: A. Is a strong incentive for rivals to decrease prices B. Is a strong incentive for rivals to increase prices C. Is one price at which marginal revenue equals marginal cost D. Are several prices at which marginal revenue equals marginal cost
d
If there are external or spillover benefits associated with consumption and production of a product, it can be said that the: A. government should consider placing a special tax on producers. B. government should consider prohibiting the production of the commodity. C. supply curve for the product lies too far to the right to provide an efficient allocation of resources. D. demand curve understates the total benefit from the product and resources are underallocated to its production.
d
In a market where there are external or spillover costs associated with consumption and production, the equilibrium will not be efficient because: A. price will be greater than MC. B. firms will shut down until costs are reduced. C. costs of production will, on average, be too high. D. too many resources will be allocated to production of the good.
d
In effect tariffs on imports are: A. special taxes on domestic producers. B. subsidies to domestic consumers. C. subsidies to foreign producers. D. subsidies for domestic producers
d
A firm is observed using 15 units of input X when the price of X is $2, and 10 units of X when its price increases to $4. What is the elasticity of demand for input X in this price range? A. 1/2 = .5 B. 3/5 = .6 C. 5/3 = 1.67 D. 2
• Midpoint formual • %changeQ/%changeP • [Q2-Q1/(Q2+Q1)] X [P2+P1/P2-P1]• B
The long-run supply curve under pure competition will be: A. Downsloping in a decreasing-cost industry and upsloping in an increasing-cost industry B. Horizontal in a constant-cost industry and downsloping in an increasing-cost industry C. Vertical in a constant-cost industry and upsloping in a decreasing-cost industry D. Upsloping in an increasing-cost industry and vertical in a constant-cost industry
A?
The demand curve shows the relationship between: A. money income and quantity demanded. B. price and production costs. C. price and quantity demanded. D. consumer tastes and the quantity demanded.
(C)
If a price-discriminating monopolist sells the same product in two markets but charges a higher price in market X and a lower price in market Y, the pricing difference indicates that demand is: A. More elastic in market X than market Y B. Less elastic in market X than market Y C. More elastic in market Y than market X D. The same in both market X and Y
?
A 4 percent reduction in the price of a product causes consumption (demand) to remain unaffected. The price elasticity of demand is: A. zero. B. greater than zero. C. greater than zero but less than 1. D. equal to 1.
A
Compared to the purely competitive firm, a pure monopoly: A. Is able to use barriers to entry and maintain positive economic profits in the long run B. Produces an equal amount of output, but charges higher prices to cover all costs in the market C. Is efficient from society's perspective because it has big plants and it uses the newest possible production technology D. Will always become competitive in the long run because positive economic profits will induce competitors into the market
A
In pure competition, the marginal revenue of a firm always equals: A. Product price B. Total revenue C. Average total cost D. Marginal cost
A
Suppose that when the price of good X changes from $5 to $10, the demand for good Y changes from 110 to 100, then the cross-elasticity of demand is A. -0.14 and the goods are complements. B. 11.1 and the goods are complements. C. 11.1 and the goods are substitutes. D. -11.1 and the goods are complements
A
The Campus Crustacean Company receives $2 per box for its crawfish and is selling 1,600 boxes to maximize its profits. What is the per unit profit on a box of crawfish at the profit-maximizing level of output if the variable cost is $1 per box and fixed costs are $1,200? A. $.25 B. $.50 C. $1.00 D. $1.25
A
The law of diminishing returns indicates that: A. as extra units of a variable resource are added to a fixed resource, marginal product will decline beyond some point. B. because of economies and diseconomies of scale a competitive firm's long-run average total cost curve will be U-shaped. C. the demand for goods produced by purely competitive industries is downward sloping. D. beyond some point the extra utility derived from additional units of a product will yield the consumer smaller and smaller extra amounts of satisfaction
A
Which of the following pairs of goods is most likely to a positive cross-price elasticity of demand? A. Steak and Hamburger. (substitutes) B. Fighter jets and pencils. (expect it to be 0) C. Hamburgers and hamburger buns. (compliments) D. College professors and textbooks. (compliments)
A
Which of the following statements concerning the relationships between total product (TP), average product (AP), and marginal product (MP) is not correct? A. AP continues to rise so long as TP is rising. B. AP reaches a maximum before TP reaches a maximum. C. TP reaches a maximum when the MP of the variable input becomes zero. D. MP cuts AP at the maximum AP.
A
Assume a purely competitive increasing-cost industry is initially in long-run equilibrium and that an increase in consumer demand occurs. After all economic adjustments have been completed, product price will be: A. Higher, and total output will be larger than originally B. Lower, and total output will be smaller than originally C. Lower, but total output will be larger than originally D. Higher, but total output will be smaller than originally
A Increase in demand will increase price and level of output. Figure 7.9 (b)
If the price elasticity of demand for a product is equal to 0.5, then a 10 percent decrease in price will: A. increase quantity demanded by 5 percent. B. increase quantity demanded by 0.5 percent. C. decrease quantity demanded by 5 percent. D. decrease quantity demanded by 0.5 percent.
A (price elasticity of demand is negative?)
A firm sells a product in a purely competitive market. The marginal cost of the product at the current output of 1,000 units is $2.50. The minimum possible average variable cost is $2.00. The market price of the product is $2.50. To maximize profit or minimize losses, the firm should: A. Continue producing 1,000 units B. Produce less than 1,000 units C. Produce more than 1,000 units D. Shut down
A MR=MC, meaning this is the best I can do
Suppose that when the price of good X changes from $5 to $10, the demand for good Y changes from 110 to 100, then the cross-elasticity of demand is A. -0.14 and the goods are complements. B. 11.1 and the goods are complements. C. 11.1 and the goods are substitutes. D. -11.1 and the goods are complements.
A [(100-110) / 100+110] X [(5+10) / (10-5)]
Consumers who clip and redeem discount coupons: A. Exhibit the same price elasticity of demand for a given product than consumers who do not clip and redeem coupons B. Exhibit more price elasticity of demand for a given product than consumers who do not clip and redeem coupons C. Exhibit less price elasticity of demand for a given product than consumers who do not clip and redeem coupons D. Cause total revenue to decrease for firms that issue coupons for their products
B
If a 5 percent fall in the price of a product causes the quantity demanded of the product to increase by 10 percent, the demand is: A. inelastic. B. elastic. C. unit elastic. D. perfectly elastic.
B
In a purely competitive industry, an optimal allocation of scarce resources occurs when: A. P = AC B. P = MC C. MR = MC D. TR = TC
B
The production of agricultural products such as wheat or corn would best be described by which market model? A. Monopolistic competition B. Pure competition C. Pure monopoly D. Oligopoly
B
When a purely competitive industry is in long-run equilibrium, which statement is true? A. Average total cost is less than marginal cost B. Price and average total cost are equal C. Marginal cost is at its maximum level D. Marginal revenue is greater than price
B
Which idea is inconsistent with pure competition? A. Short-run losses B. Product differentiation C. Freedom of entry or exit for firms D. A large number of buyers and sellers
B
Which of the following will not cause the demand for product K to change? A. a change in the price of close-substitute product J B. an increase in consumer incomes C. a change in the price of K D. a change in consumer tastes
B
A union representative observed that if the union members' wages were increased by some proportion, the workers would eventually suffer a greater than proportional decline in employment. This statement could best be explained if: A. The new wages are to take effect immediately B. Union labor can easily be replaced with capital C. Union labor is an insignificant portion of the total cost of production D. The demand for the final product the workers produce is relatively inelastic
B • If substitutability for other labor is high than this would describe the elasticity of it
Allocative efficiency occurs when the: A. Minimum of average total cost equals average revenue B. Minimum of average total cost equals marginal revenue C. Marginal cost equals the marginal benefit to society D. Marginal revenue equals marginal benefit to society
C
If the price of product L increases, the demand curve for close-substitute product J will: A. shift downward toward the horizontal axis. B. shift to the left. C. shift to the right. D. remain unchanged.
C
In 2007 the price of oil increased, which in turn caused the price of natural gas to rise. This can best be explained by saying that oil and natural gas are: A. complementary goods and the higher price for oil increased the demand for natural gas. B. substitute goods and the higher price for oil increased the demand for natural gas. C. complementary goods and the higher price for oil decreased the supply of natural gas. D. substitute goods and the higher price for oil decreased the supply of natural gas.
C
Let us suppose Harry's, a local supplier of chili and pizza, has the following revenue and cost structure: A. Harry's should stay open in the long run B. Harry's should shut down in the short run C. Harry's should stay open in the short run D. Harry's should shut down in the short run but reopen in the long run
C
The price elasticity of demand is a measure of the: A. steepness or slope of a demand curve. B. absolute changes in quantity demanded and price. C. responsiveness of quantity demanded to a change in price. D. sensitivity of the quantity demanded for one good to a change in the price of another good.
C
Which of the following will not cause the demand for product K to change? A. a change in the price of close-substitute product J B. an increase in consumer incomes C. a change in the price of K D. a change in consumer tastes
C
For which of the following goods would you most likely observe the characteristic of excludability? A. A concert in the city park. B. A professional baseball game. C. Exterior Christmas lights. D. An interstate highway.
b
A purely competitive firm is producing at the point where its marginal cost equals the price of its product. If the firm increases its output, then total revenue will: A. Increase and profits will increase B. Decrease and profits will increase C. Increase and profits will decrease D. Decrease and profits will decrease
C Total Revenue = P*Q, Right now at profit maximizing point, producing more or less profits will go down, total revenue will increase but profit will decrease b/c of VC
In pure competition, the demand for the product of a single firm is perfectly: A. Elastic because the firm produces a unique product B. Inelastic because the firm produces a unique product C. Elastic because many other firms produce the same product D. Inelastic because many other firms produce the same product
C elasticity means price sensitive, if I sell it for less than my neighbor, the consumer doesn't' care where it comes from
An economist for a bicycle company predicts that, other things equal, a rise in consumer incomes will increase the demand for bicycles. This prediction is based on the assumption that: A. there are many goods that are substitutes for bicycles. B. there are many goods that are complementary to bicycles. C. there are few goods that are substitutes for bicycles. D. bicycles are normal goods.
D
Any activity designed to transfer income or wealth to a particular individual or firm at society's expense is called: A. Patent protection B. X-inefficiency C. Price discrimination D. Rent-seeking
D
In the standard model of pure competition, a profit-maximizing entrepreneur will shut down in the short run if: A. Marginal cost is greater than average revenue B. Average cost is greater than average revenue C. Average fixed cost is greater than average revenue D. Total revenue is less than total variable costs
D
Farmer Jones is producing wheat, and must accept the market price of $6.00 per bushel. At this time, her average total costs and her marginal costs both equal $8.00 per bushel. Her average variable costs are $5 per bushel. In choosing her optimal output, farmer Jones should: A. Increase output B. Increase selling price C. Produce zero output and close down D. Reduce output but continue production
D?
The average cost curve of labor facing the monopsonist: A. Is the supply curve of labor B. Lies below its supply curve C. Lies above its supply curve D. Is the marginal cost curve of labor
a
The wages of plumbers are likely to increase when: A. Licensing standards for the occupation are increased B. There is an increase in the cost of plumbing supplies C. The length of the training period for plumbers is decreased D. More do-it-yourself home improvement centers open across the nation
a
What will the elasticity of resource demand be if unit wages rise by 8 percent and the number of employed workers falls by 5 percent? A. 0.63 B. 1.61 C. 2.90 D. 4.00
a
When the supply curve of labor is upward sloping, the marginal cost curve of labor facing the monopsonist: A. Lies above the supply curve of labor B. Is the supply curve of labor that it faces C. Lies below and parallel to the supply curve of labor D. Lies above and parallel to the supply curve of labor
a
A major distinction between a monopolistically competitive firm and an oligopolistic firm is that: A. One is a price taker and the other is a price maker B. A recognized interdependence exists between firms in one industry but not in the other C. One always produces differentiated products and the other always produces a homogeneous product D. One necessarily faces a downward-sloping demand curve and the other a horizontal demand curve
b
A protective tariff will: A. increase the sales of foreign exporters. B. increase the price and sales of domestic producers. C. increase the welfare of domestic consumers. D. create an efficiency gain in the domestic economy.
b
An example of derived demand is the demand for: A. Housing by consumers B. Machines by businesses C. Paper products by households D. Agricultural products by foreign consumers
b
As it relates to international trade, dumping: A. is a form of price discrimination illegal under U.S. antitrust laws. B. is the practice of selling goods in a foreign market at less than cost. C. constitutes a general case for permanent tariffs. D. is defined as selling more goods than allowed by an import quota.
b
Suppose that Jane earns $10,000 in year 1 and $100,000 in year 2, while Jim earns $100,000 in year 1 and $10,000 in year 2. Is there income equality for the two individuals? A. The annual data indicate equality, but the two-year data indicate inequality B. The annual data indicate inequality, but the two-year data indicate equality C. Both the annual and the two-year data indicate equality D. Both the annual and the two-year data indicate inequality
b
The necessity to maintain incentives to work and incentives to produce output would be a point made by an individual making the case for: A. Income equality B. Income inequality C. Maximization of total utility D. Maximization of marginal utility
b
The principle underlying the kinked demand curve model of oligopoly is that the demand curve facing one firm is more elastic when other firms in the industry: A. Match the firm's price changes B. Hold price constant when the firm changes its prices C. Hold quantities constant when the firm changes its prices D. Change prices in the opposite direction when the firm changes its prices
b
Under oligopoly, if one firm in an industry significantly increases advertising expenditures in order to capture a greater market share, it is most likely that other firms in that industry will: A. Pursue a strategy to reduce advertising expenditures to maintain profits B. Decide to increase advertising expenditures even if it means a reduction in profits C. Make no changes in advertising expenditures because advertising is effective in the short run, but not the long run D. Increase the price of the product to improve profits and then increase advertising expenditures
b
What is one of the major shortcomings of using tariffs or quotas to "save American jobs"? A. Trade barriers protect the development of new technology, but the new technology eliminates jobs B. Import restrictions alter the composition of domestic employment, but they have minimal effect on the amount of domestic employment C. The volume of trade with other nations is limited to a few industries, so trade restrictions would not increase national employment D. Major American firms have produced many products in other countries, and would not hire more domestic labor when trade barriers are imposed
b
Which is an example of a change in product demand that increases labor demand? A. Access to computers increases the productivity of mail order businesses, thus increasing the demand for their workers B. Tourism increases in popularity, increasing the demand for workers at tourist resorts C. A decrease in the price of trucks decreases the cost of transporting goods, thus increasing the demand for truckers D. A change in work rules increases output per worker in the auto industry, thus increasing the demand for auto workers
b
Complete income equality using the Gini ratio would be reflected by a value of: A. 2 B. 3 C. 0 D. 1
c
If nothing is done to correct this situation: A. there will be an overallocation of resources to the production of electricity. B. there will be an underallocation of resources to the production of paper products. C. there will be an overallocation of resources to the production of paper products. D. the price of electricity will be lower than it should be.
c
Social Security payments are primarily made to: A. Families with dependent children B. Families affected by natural disasters C. Retired and disabled workers D. Unemployed workers
c
The World Trade Organization: A. is also known as the International Monetary Fund (IMF). B. is also known as NAFTA. C. was established to resolve disputes arising under world trade rules. D. enhances world trade by providing interest rate subsidies to foreign borrowers who buy exports on credit.
c
The economic inefficiency of monopolistic competition means that: A. Industries tend to evolve into oligopolies rather than become more competitive B. Industries spend money on advertising and sales promotion C. Producers produce at an output short of, and charge a price greater than, minimum average total cost D. Firms do not maximize profits at the MC equals MR output
c
The eligibility basis for food stamps is: A. Age B. Illness C. Income D. Disability
c
The long-run effect of tariffs is: A. An increase in domestic employment B. An increase in export businesses C. A reallocation of domestic workers from export industries to protected domestic industries D. A reallocation of consumer spending to imported products over domestically-produced products
c
Which is a payment or wage subsidy made by the Federal government to offset Social Security taxes for low-income workers? A. Food stamp program B. Supplement Security Income C. Earned-income tax credit D. Temporary Assistance to Needy Families
c
Which is an example of a change in the price of another resource that increases labor demand? A. Software sales rise, thus increasing the demand for software developers B. Snowboarding increases in popularity, thus increasing the demand for the workers who make snowboards C. A decrease in the price of wood decreases the cost of furniture, thus increasing the demand for furniture workers D. A technological change increases output per worker in the computer industry, thus increasing the demand for computer workers
c
Which is an example of a negative externality? A. an increase in the value of land you own when a nearby development is completed B. the costs paid by a company to build an automated factory C. decreased property values in a neighborhood where several houses are burglarized D. the higher price you pay when you buy a heavily advertised product
c
Which of the following is the best example of market failure? A. Lucian wants more video games but doesn't buy them because his willingness to pay is less than the equilibrium price in the market. B. Kara's Kitten Shop won't sell more purebred cats because the equilibrium price in the market is less than it would cost her to provide more. C. Alex and others in a community want a new outdoor soccer field, and are willing to pay to use it, but no private business is willing to build it. D. Government fixes the price of gasoline, resulting in a shortage.
c
Which organization meets regularly to establish rules related to international trade? A. The United Nations B. The Bank of America C. The World Trade Organization D. The Federal Reserve Board
c
Marginal revenue product describes the: A. Output produced by the last unit of input employed B. Revenue received for the last unit of output produced C. Price a consumer paid for the last unit of output produced D. Revenue received for the output produced by the last unit of labor employed
d
The difference between the 45-degree line and the Lorenz curve shows the: A. Inflationary gap B. Recessionary gap C. Number of households that are classified as being poor D. Degree of income inequality
d
The increased-domestic-employment argument for tariff protection holds that: A. domestic inflation is a desirable policy goal because it stimulates exports. B. domestic deflation is a desirable policy goal because it stimulates imports. C. an increase in tariffs will reduce net exports and stimulate domestic employment. D. an increase in tariffs will increase net exports and stimulate domestic employment
d
Which is an example of a change in productivity that increases labor demand? A. Mail-order catalog sales rise, thus increasing the demand for workers in the mail-order business B. Sport utility vehicles increase in popularity, thus increasing the demand for the workers who make them C. A decrease in the price of lumber decreases the cost of building homes, thus increasing the demand for construction workers D. A technological change increases output per worker in the computer industry, thus increasing the demand for computer workers
d
Which of the following policies would be most appropriate for dealing with this problem? A. Levy a tax on the consumers of paper products and use the tax revenues to conduct research on new energy sources. B. Levy a tax on the consumers of electricity and use the tax revenues to subsidize the consumers of paper products. C. Levy a tax on the producers of electricity and use the tax revenues to clean up the river. D. Levy a tax on the producers of paper products and use the tax revenues to clean up the river.
d
In firm X, labor costs are 85 percent of production costs, while in firm Y labor costs are 40 percent of production costs. A 20 percent increase in wages would increase production costs by: A. 23 percent in firm X and 20 percent in firm Y B. 19 percent in firm X and 15 percent in firm Y C. 15 percent in firm X and 6 percent in firm Y D. 17 percent in firm X and 8 percent in firm Y
d • (20% X 85%)=17%
Which is not commonly offered as a reason to support protectionism and abandon free trade? A. Maintaining military self-sufficiency B. Increasing domestic employment C. Allowing infant industries to mature and become competitive D. Promoting specialization and increasing worldwide production levels
d; this is a counter agrument
