Exam 4: Tariffs

Relatively low wages in Mexico make it impossible for U.S. manufacturers of labor-intensive goods to compete against Mexican manufacturers.

When the production of a commodity does $\underline { \text { not } }$ utilize imported inputs, the effective tariff rate on the commodity:

A compound tariff is a combination of a (an):

The principal benefit of tariff protection goes to:

If I purchase a stereo from South Korea, I obtain the stereo and South Korea obtains the dollars. But if I purchase a stereo produced in the United States, I obtain the stereo and the dollars remain in America. This line of reasoning is:

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs Imparted VCRs Damestic VCRs Campanent parts 4150 Imported campanent parts \ 150 Assembly cast/profit 50 Assembly cast 50 Naminal tariff 25 Profit 25 --- --- Impart price Damestic price 225 after tariff 225 after tariff 225 -Consider Table 4.1. Prior to the tariff, the total price of imported VCRs is:

According to the tariff escalation effect, industrial countries apply low tariffs to imports of finished goods and high tariffs to imports of raw materials.

Which of the following is $\underline { \text { true } }$ concerning a specific tariff?

A $100 specific tariff provides home producers $\underline { \text { more } }$ protection from foreign competition when:

Is it possible for a low nominal tariff rate to understate the effective rate of protection? What is tariff escalation?

Figure 4.4 Market for Gasoline in a Small Nation -Figure 4.4 represents the market for gasoline in a small nation. The free trade world price of gasoline is $3.50. Suppose this small nation imposes a tariff on gasoline of $.50 per gallon. The change in producer surplus would be

Which of the following is a fixed percentage of the value of an imported product as it enters the country?

Figure 4.1 illustrates the demand and supply schedules for pocket calculators in Mexico, a "small" nation that is unable to affect the world price. Figure 4.1. Import Tariff Levied by a "Small" Country -Consider Figure 4.1. In the absence of trade, Mexico produces and consumes:

Suppose that the United States $\underline { \text { eliminates } }$ its tariff on steel imports, permitting foreign-produced steel to enter the U.S. market. Steel prices to U.S. consumers would be expected to:

A tax of 20 cents per unit of imported cheese would be an example of:

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs Imparted VCRs Damestic VCRs Campanent parts 4150 Imported campanent parts \ 150 Assembly cast/profit 50 Assembly cast 50 Naminal tariff 25 Profit 25 --- --- Impart price Damestic price 225 after tariff 225 after tariff 225 -Consider Table 4.1. Prior to the tariff, domestic value added equals:

Suppose that the production of $500,000 worth of steel in the United States requires $100,000 worth of iron ore. The U.S. nominal tariff rates for importing these goods are 15 percent for steel and 5 percent for iron ore. Given this information, the effective rate of protection for the U.S. steel industry is approximately:

If we consider the impact on both consumers and producers, then protection of the steel industry is:

Figure 4.1 illustrates the demand and supply schedules for pocket calculators in Mexico, a "small" nation that is unable to affect the world price. Figure 4.1. Import Tariff Levied by a "Small" Country -Consider Figure 4.1. With free trade, Mexico imports:

For the United States, a foreign trade zone (FTZ) is