Question 1

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

Accepted Answer

A)  It lowers the price of cheese domestically. 
B)  It raises the price of cheese internationally. 
C)  It raises revenue for the government. 
D)  It will always result in retaliation from abroad. 
E)  it leads to higher domestic demand for cheese. 
A)  It lowers the price of cheese domestically. 
B)  It raises the price of cheese internationally. 
C)  It raises revenue for the government. 
D)  It will always result in retaliation from abroad. 
E)  it leads to higher domestic demand for cheese.

Question 2

Tariffs are NOT defended on the grounds that they

Accepted Answer

A)  improve the terms of trade of foreign nations. 
B)  protect jobs and reduce unemployment. 
C)  promote growth and development of young industries. 
D)  prevent over-dependence of a country on only a few industries. 
E)  protect domestic producers from foreign low prices. 
A)  improve the terms of trade of foreign nations. 
B)  protect jobs and reduce unemployment. 
C)  promote growth and development of young industries. 
D)  prevent over-dependence of a country on only a few industries. 
E)  protect domestic producers from foreign low prices.

Question 3

The imposition of tariffs will help a nation attain which of the following goals?

Accepted Answer

A)  decreased domestic consumer prices 
B)  increased domestic employment 
C)  increased amount and variety of goods available for consumers 
D)  increased competition between domestic and foreign producers 
E)  gains for domestic producers 
A)  decreased domestic consumer prices 
B)  increased domestic employment 
C)  increased amount and variety of goods available for consumers 
D)  increased competition between domestic and foreign producers 
E)  gains for domestic producers

Question 4

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.

Question 5

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

Accepted Answer

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

Question 6

The U.S. sugar quota

Accepted Answer

A)  generates government revenue. 
B)  results in net welfare benefits to the U.S. economy. 
C)  results in benefits to sugar producers that exceed the cost to consumers. 
D)  results in costs to consumers that exceed the benefits to sugar producers. 
E)  does not result in an efficiency loss. 
A)  generates government revenue. 
B)  results in net welfare benefits to the U.S. economy. 
C)  results in benefits to sugar producers that exceed the cost to consumers. 
D)  results in costs to consumers that exceed the benefits to sugar producers. 
E)  does not result in an efficiency loss.

Question 7

When a government allows raw materials and other intermediate products to enter a country duty free, this generally results in a(an)

Accepted Answer

A)  effective tariff rate less than the nominal tariff rate. 
B)  nominal tariff rate less than the effective tariff rate. 
C)  rise in both nominal and effective tariff rates. 
D)  fall in both nominal and effective tariff rates. 
E)  rise in only the effective tariff rate. 
A)  effective tariff rate less than the nominal tariff rate. 
B)  nominal tariff rate less than the effective tariff rate. 
C)  rise in both nominal and effective tariff rates. 
D)  fall in both nominal and effective tariff rates. 
E)  rise in only the effective tariff rate.

Question 8

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 9

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.

Question 10

Ad valorem tariffs are

Accepted Answer

A)  import taxes stated in ads in industry publications. 
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 solely on the origin country. 
A)  import taxes stated in ads in industry publications. 
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 solely on the origin country.

Question 11

-Refer to above figure. The lowest specific tariff which would be considered prohibitive is ________.

Accepted Answer

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

Question 12

-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

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

Question 13

Which of the following is a fixed percentage of the value of an imported product?

Accepted Answer

A)  specific tariff 
B)  ad valorem tariff 
C)  nominal tariff 
D)  effective protection tariff 
E)  infant industry tariff 
A)  specific tariff 
B)  ad valorem tariff 
C)  nominal tariff 
D)  effective protection tariff 
E)  infant industry tariff

Question 14

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?

Accepted Answer

The cascading tariff structure is probab

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

Tariffs are NOT defended on the grounds that they

The imposition of tariffs will help a nation attain which of the following goals?

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

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

The U.S. sugar quota

When a government allows raw materials and other intermediate products to enter a country duty free, this generally results in a(an)

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

An important difference between tariffs and quotas is that tariffs

Ad valorem tariffs are

-Refer to above figure. The lowest specific tariff which would be considered prohibitive is ________.

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

Which of the following is a fixed percentage of the value of an imported product?

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

Exam 9: The Instruments of Trade Policy

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

Tariffs are NOT defended on the grounds that they

The imposition of tariffs will help a nation attain which of the following goals?

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

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

The U.S. sugar quota

When a government allows raw materials and other intermediate products to enter a country duty free, this generally results in a(an)

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

An important difference between tariffs and quotas is that tariffs

Ad valorem tariffs are

-Refer to above figure. The lowest specific tariff which would be considered prohibitive is ________.

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

Which of the following is a fixed percentage of the value of an imported product?

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