Question 1

An important difference between tariffs and quotas is that tariffs

Accepted Answer

A) raise the price of the good. 
B) generate tax revenue for the government. 
C) stimulate international trade. 
D) help domestic producers. 
E) are paid by foreign producers. 
A) raise the price of the good. 
B) generate tax revenue for the government. 
C) stimulate international trade. 
D) help domestic producers. 
E) are paid by foreign producers. B

Question 2

-Refer to above figure.In the absence of a tariff and in the presence of trade,what is the country's consumer surplus?

Accepted Answer

$550

Question 3

The European Union's Common Agricultural Policy (CAP)is,in effect

Accepted Answer

A) a tariff imposed on agricultural exports. 
B) a tariff imposed on agricultural imports. 
C) a subsidy that reduces the cost of agricultural exports. 
D) a subsidy that increases the cost of agricultural exports. 
E) a quota that limits production of agricultural goods by EU nations. 
A) a tariff imposed on agricultural exports. 
B) a tariff imposed on agricultural imports. 
C) a subsidy that reduces the cost of agricultural exports. 
D) a subsidy that increases the cost of agricultural exports. 
E) a quota that limits production of agricultural goods by EU nations. C

Question 4

-Refer to above figure.The loss of Consumer Surplus due to the tariff equals ________.

Accepted Answer

The answer of  
-Refer to above figure.The loss of...

Question 5

The change in the economic welfare of a country associated with an increase in a tariff equals

Accepted Answer

A) efficiency loss - terms of trade gain. 
B) efficiency gain - terms of trade loss. 
C) efficiency loss + tax revenue gain. 
D) efficiency loss + tax revenue gain + terms of trade gain. 
E) efficiency loss - tax revenue gain. 
A) efficiency loss - terms of trade gain. 
B) efficiency gain - terms of trade loss. 
C) efficiency loss + tax revenue gain. 
D) efficiency loss + tax revenue gain + terms of trade gain. 
E) efficiency loss - tax revenue gain.

Question 6

An export subsidy will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Accepted Answer

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

Question 7

-Refer to above figure.In the absence of trade,how many Widgets does this country consume?

Accepted Answer

The answer of  
-Refer to above figure.In the absence...

Question 8

-Refer to above figure.In the absence of trade,what is the country's consumer surplus?

Accepted Answer

The answer of  
-Refer to above figure.In the absence...

Question 9

Some argue that tariffs always hurt the imposing country's economic welfare,and are typically designed to shift resources from one sector to another,protected or preferred one,within an economy.Find and discuss a counter example to this argument.

Accepted Answer

The optimum tariff i

Question 10

A tax of 20 percent per unit of imported garlic is an example of a(n)

Accepted Answer

A) specific tariff. 
B) ad valorem tariff. 
C) nominal tariff. 
D) effective protection tariff. 
E) a disadvantageous tariff 
A) specific tariff. 
B) ad valorem tariff. 
C) nominal tariff. 
D) effective protection tariff. 
E) a disadvantageous tariff

Question 11

-Refer to above figure.With a specific tariff of $3 per unit,what is the quantity of Widgets imported?

Accepted Answer

The answer of  
-Refer to above figure.With a specific...

Question 12

An export subsidy differs from a tariff in each of the following ways EXCEPT

Accepted Answer

A) a tariff generates revenue. 
B) a tariff is applied to imports. 
C) a tariff results in an efficiency loss. 
D) a tariff is a tax. 
E) a tariff discourages imports. 
A) a tariff generates revenue. 
B) a tariff is applied to imports. 
C) a tariff results in an efficiency loss. 
D) a tariff is a tax. 
E) a tariff discourages imports.

Question 13

Specific tariffs are

Accepted Answer

A) import taxes stated in specific legal statutes. 
B) import taxes calculated as a fixed charge for each unit of imported goods. 
C) import taxes calculated as a fraction of the value of the imported goods. 
D) the same as import quotas. 
E) import taxes calculated based solely on the origin country. 
A) import taxes stated in specific legal statutes. 
B) import taxes calculated as a fixed charge for each unit of imported goods. 
C) import taxes calculated as a fraction of the value of the imported goods. 
D) the same as import quotas. 
E) import taxes calculated based solely on the origin country.

Question 14

An import quota is similar to a ________ in its effect on imports,except that an import quota ________.

Accepted Answer

A) tariff;does not generate revenue 
B) tariff;generates revenue 
C) subsidy;does not generate revenue 
D) subsidy;generates revenue 
E) tariff;does not result in an efficiency loss. 
A) tariff;does not generate revenue 
B) tariff;generates revenue 
C) subsidy;does not generate revenue 
D) subsidy;generates revenue 
E) tariff;does not result in an efficiency loss.

Question 15

-Refer to above figure.With free trade and no tariffs,what is the quantity of Widgets produced domestically?

Accepted Answer

The answer of  
-Refer to above figure.With free trade...

Question 16

The main redistribution effect of a tariff is the transfer of income from

Accepted Answer

A) domestic producers to domestic buyers. 
B) domestic buyers to domestic producers. 
C) domestic producers to domestic government. 
D) domestic government to domestic consumers. 
E) foreign producers to domestic consumers. 
A) domestic producers to domestic buyers. 
B) domestic buyers to domestic producers. 
C) domestic producers to domestic government. 
D) domestic government to domestic consumers. 
E) foreign producers to domestic consumers.

Question 17

A voluntary export restraint will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Accepted Answer

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

Question 18

The tariff levied in a "large country" (Home),lowers the world price of the imported good.This causes

Accepted Answer

A) foreign consumers to demand less of the good on which was levied a tariff. 
B) domestic demand for imports to decrease. 
C) domestic demand for imports to increase. 
D) foreign suppliers to produce less of the good on which was levied a tariff. 
E) no change in the foreign price of the good it imports. 
A) foreign consumers to demand less of the good on which was levied a tariff. 
B) domestic demand for imports to decrease. 
C) domestic demand for imports to increase. 
D) foreign suppliers to produce less of the good on which was levied a tariff. 
E) no change in the foreign price of the good it imports.

Question 19

A specific tariff provides home producers more protection when

Accepted Answer

A) the home market buys cheaper products rather than expensive products. 
B) it is applied to a commodity with many grade variations. 
C) the home demand for a good is elastic with respect to price changes. 
D) it is levied on manufactured goods rather than primary products. 
E) the home supply outnumbers the foreign imports. 
A) the home market buys cheaper products rather than expensive products. 
B) it is applied to a commodity with many grade variations. 
C) the home demand for a good is elastic with respect to price changes. 
D) it is levied on manufactured goods rather than primary products. 
E) the home supply outnumbers the foreign imports.

Question 20

As globalization tends to increase the proportion of imported inputs relative to domestically supplied components

Accepted Answer

A) the nominal tariff automatically increases. 
B) the rate of (effective)protection automatically decreases. 
C) the nominal tariff automatically decreases. 
D) the rate of (effective)protection automatically increases. 
E) the amount of tariffs levied increases. 
A) the nominal tariff automatically increases. 
B) the rate of (effective)protection automatically decreases. 
C) the nominal tariff automatically decreases. 
D) the rate of (effective)protection automatically increases. 
E) the amount of tariffs levied increases.

Exam 9: The Instruments of Trade Policy

An important difference between tariffs and quotas is that tariffs

-Refer to above figure.In the absence of a tariff and in the presence of trade,what is the country's consumer surplus?

The European Union's Common Agricultural Policy (CAP)is,in effect

-Refer to above figure.The loss of Consumer Surplus due to the tariff equals ________.

The change in the economic welfare of a country associated with an increase in a tariff equals

An export subsidy will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

-Refer to above figure.In the absence of trade,how many Widgets does this country consume?

-Refer to above figure.In the absence of trade,what is the country's consumer surplus?

Some argue that tariffs always hurt the imposing country's economic welfare,and are typically designed to shift resources from one sector to another,protected or preferred one,within an economy.Find and discuss a counter example to this argument.

A tax of 20 percent per unit of imported garlic is an example of a(n)

-Refer to above figure.With a specific tariff of $3 per unit,what is the quantity of Widgets imported?

An export subsidy differs from a tariff in each of the following ways EXCEPT

Specific tariffs are

An import quota is similar to a ________ in its effect on imports,except that an import quota ________.

-Refer to above figure.With free trade and no tariffs,what is the quantity of Widgets produced domestically?

The main redistribution effect of a tariff is the transfer of income from

A voluntary export restraint will ________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

The tariff levied in a "large country" (Home),lowers the world price of the imported good.This causes

A specific tariff provides home producers more protection when

As globalization tends to increase the proportion of imported inputs relative to domestically supplied components

Introduction

World Trade: An Overview

Labor Productivity and Comparative Advantage: The Ricardian Model

Specific Factors and Income Distribution

Resources and Trade: the Heckscher-Ohlin Model

The Standard Trade Model

External Economies of Scale and the International Location of Production

Firms in the Global Economy: Export Decisions, Outsourcing, and Multinational Enterprises

The Political Economy of Trade Policy

Trade Policy in Developing Countries

Controversies in Trade Policy

National Income Accounting and the Balance of Payments

Exchange Rates and the Foreign Exchange Market: An Asset Approach

Money,Interest Rates, and Exchange Rates

Price Levels and the Exchange Rate in the Long Run

Output and the Exchange Rate in the Short Run

Fixed Exchange Rates and Foreign Exchange Intervention

International Monetary Systems: An Historical Overview

Financial Globalization: Opportunity and Crisis

Optimum Currency Areas and the Euro

Developing Countries: Growth, Crisis, and Reform

Filters

An export subsidy will producer surplus, consumer surplus, government revenue,and overall domestic national welfare.

An import quota is similar to a in its effect on imports,except that an import quota .

A voluntary export restraint will producer surplus, consumer surplus, government revenue,and overall domestic national welfare.