Exam 8: Import Tariffs and Quotas Under Perfect Competition

The United States applies a 25% tariff on imported pickup trucks (mainly from Japan). If the United States is considered to be a "large" country, then:

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Question 1

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If the United States is a large country that imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, what will be the value of T-shirts once they have cleared U.S. customs?

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Question 2

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If the United States imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, the value of the T-shirts once they have cleared U.S. customs can be calculated by adding the tariff to the original world price.

Here's the calculation:

Tariff amount per T-shirt = 30% of $5 = 0.30 * $5 = $1.50

Therefore, the value of each T-shirt after the tariff is applied would be:

World price + Tariff = $5 + $1.50 = $6.50

So, the value of the T-shirts once they have cleared U.S. customs would be $6.50 per T-shirt.

Who captured the quota rents of the 1980s U.S-Japanese voluntary export agreement for automobiles?

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Question 3

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In the 1980s, the United States negotiated a voluntary export agreement with Japan in which each Japanese auto producer voluntarily agreed to reduce the number of its automobiles exported to the United States. This voluntary export agreement caused each Japanese auto producer to:

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Question 4

How did the WTO react to the U.S. imposition of steel tariffs in 2002?

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Question 5

In the 1980s, the United States used _________ to restrict imports of Japanese automobiles.

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Question 6

How high was the U.S. tariff on imported tires from China and when did it expire?

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Question 7

Suppose a nation agrees to limit its own exports by imposing quotas on its own firms in order to keep their revenues high, keep from breaking WTO rules, and pacify protectionist interests in the import nation. Which of the following terms describes this practice?

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Question 8

Why do countries persist in using protective measures even though most economists believe that tariffs and quotas yield welfare losses to countries?

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Question 9

How large a tariff did Donald Trump, the Republican candidate in the 2016 presidential campaign, indicate that he would levy on Chinese exports to the United States?

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Question 10

Suppose that the world price of radios is above the no-trade domestic price. In that case, the country:

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Question 11

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will , and U.S. clothing production will __.

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Question 12

We can measure producer and consumer surplus by looking at a graph of supply and demand. Consumer surplus is:

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Question 13

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _ foreign supply curves, and small countries face __ foreign supply curves.

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Question 14

Suppose that the equations S = 2P and D = 6 - P represent a small country's home supply and home demand curves. If the world price is $1, which of the following is the increase in the country's welfare when it trades compared with autarky?

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Question 15

If we assume perfect competition in the product markets, producer surplus is:

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Question 16

(Figure: The Import-Competing Industry) In the figure, what is the value of producer surplus in the absence of trade?

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Question 17

When a large nation imposes a tariff on a smaller nation and causes its terms of trade to deteriorate, the tariff is sometimes referred to as:

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Question 18

About how large were the extra deadweight losses incurred by the United States as a result of the discriminatory tariff against imported Chinese tires?

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Question 19

(Figure: Home Market II) Now suppose that the large country in the graph imposes a tariff. How large is the tariff?

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Question 20

Showing 1 - 20 of 183

Exam 8: Import Tariffs and Quotas Under Perfect Competition

The United States applies a 25% tariff on imported pickup trucks (mainly from Japan). If the United States is considered to be a "large" country, then:

If the United States is a large country that imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, what will be the value of T-shirts once they have cleared U.S. customs?

Who captured the quota rents of the 1980s U.S-Japanese voluntary export agreement for automobiles?

In the 1980s, the United States negotiated a voluntary export agreement with Japan in which each Japanese auto producer voluntarily agreed to reduce the number of its automobiles exported to the United States. This voluntary export agreement caused each Japanese auto producer to:

How did the WTO react to the U.S. imposition of steel tariffs in 2002?

In the 1980s, the United States used _________ to restrict imports of Japanese automobiles.

How high was the U.S. tariff on imported tires from China and when did it expire?

Suppose a nation agrees to limit its own exports by imposing quotas on its own firms in order to keep their revenues high, keep from breaking WTO rules, and pacify protectionist interests in the import nation. Which of the following terms describes this practice?

Why do countries persist in using protective measures even though most economists believe that tariffs and quotas yield welfare losses to countries?

How large a tariff did Donald Trump, the Republican candidate in the 2016 presidential campaign, indicate that he would levy on Chinese exports to the United States?

Suppose that the world price of radios is above the no-trade domestic price. In that case, the country:

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will ______, and U.S. clothing production will ________.

We can measure producer and consumer surplus by looking at a graph of supply and demand. Consumer surplus is:

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _____________ foreign supply curves, and small countries face ______________ foreign supply curves.

Suppose that the equations S = 2P and D = 6 - P represent a small country's home supply and home demand curves. If the world price is $1, which of the following is the increase in the country's welfare when it trades compared with autarky?

If we assume perfect competition in the product markets, producer surplus is:

(Figure: The Import-Competing Industry) In the figure, what is the value of producer surplus in the absence of trade?

When a large nation imposes a tariff on a smaller nation and causes its terms of trade to deteriorate, the tariff is sometimes referred to as:

About how large were the extra deadweight losses incurred by the United States as a result of the discriminatory tariff against imported Chinese tires?

(Figure: Home Market II) Now suppose that the large country in the graph imposes a tariff. How large is the tariff?

Trade in the Global Economy

Trade and Technology: The Ricardian Model

Gains and Losses From Trade in the Specific-Factors Model

Trade and Resources: the Heckscher-Ohlin Model

Movement of Labor and Capital Between Countries

Increasing Returns to Scale and Monopolistic Competition

Offshoring of Goods and Services

Import Tariffs and Quotas Under Imperfect Competition

Export Subsidies in Agriculture and High-Technology Industries

International Agreements: Trade, Labor, and the Environment

The Global Macroeconomy

Introduction to Exchange Rates and the Foreign Exchange Market

Exchange Rates I: the Monetary Approach in the Long Run

Exchange Rates II: the Asset Approach in the Short Run

National and International Accounts: Income, Wealth, and the Balance of Payments

Balance of Payments I: the Gains From Financial Globalization

Balance of Payments II: Output, Exchange Rates, and Macroeconomic Policies in the Short Run

Fixed Versus Floating: International Monetary Experience

Exchange Rate Crises: How Pegs Work and How They Break

The Euro

Topics in International Macroeconomics

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Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will , and U.S. clothing production will __.

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _ foreign supply curves, and small countries face __ foreign supply curves.