For each of the following scenarios, predict how consumption changes for both consumption smoothers and hand-to-mouth consumers. How does total consumption change? Household incomes rise 6% this year, but income growth is expected to return to its normal growth rate of 2% next year. A country with an economy based heavily on agricultural production experiences a natural disaster so severe that it will take decades for farmers to recover. People expect the economy to experience a recession over the next six months

Arguments made against free trade include all of the following exceptdumping is an unfair trade practice that puts domestic producers of substitute goods at a disadvantage that they should be protected against. national defense considerations justify producing certain goods domestically whether the country has a comparative advantage in their production or not. free trade is inflationary and should be restricted in the domestic interest. if foreign governments subsidize their exports, foreign firms that export are given an unfair advantage that domestic producers should be protected against. infant industries should be protected from free trade so that they may have time to develop and compete on an even basis with older, more established foreign industries.