Exam 9: The Instruments of Trade Policy

In the country levying the tariff,the tariff will

The effective rate of protection is a weighted average of nominal tariffs and tariffs on imported inputs.It has been noted that in most industrialized countries,the nominal tariffs on raw materials or intermediate components or products are lower than on final-stage products meant for final markets.Why would countries design their tariff structures in this manner? Who tends to be helped,and who is harmed by this cascading tariff structure?

The U.S.sugar quota

The two deadweight triangles are the Consumption distortion and Production distortion losses.It is easy to understand why the Consumption distortion constitutes a loss for society.After all it raises the prices of goods to consumers,and even causes some consumers to drop out of the market altogether.It seems paradoxical that the Production distortion is considered an equivalent burden on society.After all,in this case,profits increase,and additional production (with its associated employment)comes on line.This would seem to be an offset rather than an addition to the burden or loss borne by society.Explain why the Production distortion is indeed a loss to society,and what is wrong with the logic that leads to the apparent paradox.

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

The most vocal political pressure for tariffs is generally made by

The fact that industrialized countries levy very low or no tariff on raw materials and semi processed goods

If an import-competing firm is imperfectly competitive,then under free trade an export tariff will ________ domestic market price,________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Should the home country be "large" relative to its trade partners,its imposition of a tariff on imports would lead to an increase in domestic welfare if the terms of the trade rectangle exceed the sum of the

Which type of tariff is forbidden in the United States on Constitutional grounds?

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.

In an inflationary environment,then over time

A policy of tariff reduction in the computer industry is

Which of the following are examples of goods that have been subject to voluntary export restraints?

The imposition of tariffs on imports results in deadweight (triangle)losses.These are

Suppose an import-competing firm is imperfectly competitive.Replacement of an export tariff with an import quota that yields the same level of imports will ________ market price,________ producer surplus,________ consumer surplus,________ government revenue,and ________ overall domestic national welfare.

Tariff rates on products imported into the U.S.

What is a TRUE statement concerning the imposition in the U.S.of a tariff on cheese?

Economic theory in general,and trade theory in particular are replete with equivalencies.For example,it is argued that for any specific tariff one can find an equivalent ad valorem tariff;and that for any quota one can calculate a tariff equivalent.Discuss conditions or situations under which a specific and an ad valorem tariff are not equivalent.Discuss conditions or situations when a tariff and a quota are not equivalent.

If a good is imported into (small)country H from country F,then the imposition of a tariff In country H