At Free-Trade Prices, a Tennis Racquet in Country A, a Small

Multiple Choice

At free-trade prices, a tennis racquet in country A, a small country, sells for $100 and contains $40 worth of aluminum inputs and $30 worth of plastic. In country A, the nominal tariff rates are 40% on tennis racquets, 20% on aluminum, and 10% on plastic. Based on this information, what is the effective rate of protection for the racquet industry in country A?

A) 40%
B) 63⅓%
C) 10%
D) 96⅔%