Question 1

Free traders point out that:

Accepted Answer

A)  There is usually an efficiency gain from having tariffs 
B)  There is usually an efficiency loss from having tariffs 
C)  Producers lose from tariffs at the expense of consumers 
D)  Producers lose from tariffs at the expense of the government 
A)  There is usually an efficiency gain from having tariffs 
B)  There is usually an efficiency loss from having tariffs 
C)  Producers lose from tariffs at the expense of consumers 
D)  Producers lose from tariffs at the expense of the government

Question 2

A problem encountered when implementing an "infant industry" tariff is that:

Accepted Answer

A)  Domestic consumers will purchase the foreign good regardless of the tariff 
B)  Political pressure may prevent the tariff's removal when the industry matures 
C)  Most industries require tariff protection when they are mature 
D)  Labor unions will capture the protective effect in higher wages 
A)  Domestic consumers will purchase the foreign good regardless of the tariff 
B)  Political pressure may prevent the tariff's removal when the industry matures 
C)  Most industries require tariff protection when they are mature 
D)  Labor unions will capture the protective effect in higher wages

Question 3

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's producer surplus and consumer surplus respectively equal:

Accepted Answer

A)  $5, $605 
B)  $25, $380 
C)  $45, $250 
D)  $85, $195 
A)  $5, $605 
B)  $25, $380 
C)  $45, $250 
D)  $85, $195

Question 4

Should the home country be "large" relative to the world,its imposition of a tariff on imports would lead to an increase in domestic welfare if the terms-of-trade effect exceeds the sum of the:

Accepted Answer

A)  Revenue effect plus redistribution effect 
B)  Protective effect plus revenue effect 
C)  Consumption effect plus redistribution effect 
D)  Protective effect plus consumption effect 
A)  Revenue effect plus redistribution effect 
B)  Protective effect plus revenue effect 
C)  Consumption effect plus redistribution effect 
D)  Protective effect plus consumption effect

Question 5

Which of the following is true concerning a specific tariff?

Accepted Answer

A)  It is exclusively used by the U.S. in its tariff schedules. 
B)  It refers to a flat percentage duty applied to a good's market value. 
C)  It is plagued by problems associated with assessing import product values. 
D)  It affords less protection to home producers during eras of rising prices. 
A)  It is exclusively used by the U.S. in its tariff schedules. 
B)  It refers to a flat percentage duty applied to a good's market value. 
C)  It is plagued by problems associated with assessing import product values. 
D)  It affords less protection to home producers during eras of rising prices.

Question 6

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:

Accepted Answer

A)  10 calculators 
B)  40 calculators 
C)  60 calculators 
D)  80 calculators 
A)  10 calculators 
B)  40 calculators 
C)  60 calculators 
D)  80 calculators

Question 7

If a "small" country levies a tariff on an imported good,its overall welfare increases if the monetary value of the tariff's consumption effect plus protective effect is less than the monetary value of the terms-of-trade effect.

Accepted Answer

A) True 
 B)False

Question 8

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,the total value of Mexico's imports equal:

Accepted Answer

A)  $220 
B)  $260 
C)  $290 
D)  $300 
A)  $220 
B)  $260 
C)  $290 
D)  $300

Question 9

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
  
-According to Figure 4.1,Mexican manufacturers gain ____ because of the tariff.

Accepted Answer

A)  $75 
B)  $85 
C)  $95 
D)  $105 
A)  $75 
B)  $85 
C)  $95 
D)  $105

Question 10

Suppose that the tariff on imported steel is 40 percent,the tariff on imported iron ore is 20 percent,and 30 percent of the cost of producing a ton of steel consists of the iron ore it contains.The effective rate of protection of steel is approximately 49 percent.

Accepted Answer

A) True 
 B)False

Question 11

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs
  
-Consider Table 4.1.After the tariff,domestic value added equals:

Accepted Answer

A)  $25 
B)  $50 
C)  $75 
D)  $100 
A)  $25 
B)  $50 
C)  $75 
D)  $100

Question 12

A beggar-thy-neighbor policy is the imposition of:

Accepted Answer

A)  Free trade to increase domestic productivity 
B)  Trade barriers to increase domestic demand and employment 
C)  Import tariffs to curb domestic inflation 
D)  Revenue tariffs to make products cheaper for domestic consumers 
A)  Free trade to increase domestic productivity 
B)  Trade barriers to increase domestic demand and employment 
C)  Import tariffs to curb domestic inflation 
D)  Revenue tariffs to make products cheaper for domestic consumers

Question 13

The imposition of tariffs on imports results in deadweight welfare losses for the home economy.These losses consist of the:

Accepted Answer

A)  Protective effect plus consumption effect 
B)  Redistribution effect plus revenue effect 
C)  Revenue effect plus protective effect 
D)  Consumption effect plus redistribution effect 
A)  Protective effect plus consumption effect 
B)  Redistribution effect plus revenue effect 
C)  Revenue effect plus protective effect 
D)  Consumption effect plus redistribution effect

Question 14

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs
  
-Consider Table 4.1.Prior to the tariff,the total price of imported VCRs is:

Accepted Answer

A)  $150 
B)  $200 
C)  $225 
D)  $235 
A)  $150 
B)  $200 
C)  $225 
D)  $235

Question 15

Unlike a specific tariff,an ad valorem tariff differentiates between commodities with different values.

Accepted Answer

A) True 
 B)False

Question 16

Although tariffs on imported steel may lead to job gains for domestic steel workers,they can lead to job losses for domestic auto workers.

Accepted Answer

A) True 
 B)False

Question 17

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs
  
-Consider Table 4.1.The effective tariff rate equals:

Accepted Answer

A)  11.1 percent 
B)  16.7 percent 
C)  50.0 percent 
D)  100.0 percent 
A)  11.1 percent 
B)  16.7 percent 
C)  50.0 percent 
D)  100.0 percent

Question 18

The most vocal political pressure for tariffs is generally made by:

Accepted Answer

A)  Consumers lobbying for export tariffs 
B)  Consumers lobbying for import tariffs 
C)  Producers lobbying for export tariffs 
D)  Producers lobbying for import tariffs 
A)  Consumers lobbying for export tariffs 
B)  Consumers lobbying for import tariffs 
C)  Producers lobbying for export tariffs 
D)  Producers lobbying for import tariffs

Free traders point out that:

A problem encountered when implementing an "infant industry" tariff is that:

Should the home country be "large" relative to the world,its imposition of a tariff on imports would lead to an increase in domestic welfare if the terms-of-trade effect exceeds the sum of the:

Which of the following is true concerning a specific tariff?

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:

If a "small" country levies a tariff on an imported good,its overall welfare increases if the monetary value of the tariff's consumption effect plus protective effect is less than the monetary value of the terms-of-trade effect.

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,the total value of Mexico's imports equal:

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 -According to Figure 4.1,Mexican manufacturers gain ____ because of the tariff.

Suppose that the tariff on imported steel is 40 percent,the tariff on imported iron ore is 20 percent,and 30 percent of the cost of producing a ton of steel consists of the iron ore it contains.The effective rate of protection of steel is approximately 49 percent.

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.After the tariff,domestic value added equals:

A beggar-thy-neighbor policy is the imposition of:

The imposition of tariffs on imports results in deadweight welfare losses for the home economy.These losses consist of the:

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.Prior to the tariff,the total price of imported VCRs is:

Unlike a specific tariff,an ad valorem tariff differentiates between commodities with different values.

Although tariffs on imported steel may lead to job gains for domestic steel workers,they can lead to job losses for domestic auto workers.

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.The effective tariff rate equals:

The most vocal political pressure for tariffs is generally made by:

the International Economy and Globalization

Foundations of Modern Trade Theory: Comparative Advantage

Sources of Comparative Advantage

Nontariff Trade Barriers

Trade Regulations and Industrial Policies

Trade Policies for the Developing Nations

Regional Trading Arrangements

International Factor Movements and Multinational Enterprises

the Balance of Payments

Foreign Exchange

Exchange-rate Determination

Balance-of-payments Adjustments

Exchange-rate Adjustments and the Balance of Payments

Exchange-rate Systems and Currency Crises

Macroeconomic Policy in an Open Economy

International Banking: Reserves, debt, and Risk

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Exam 4: Tariffs

Free traders point out that:

A problem encountered when implementing an "infant industry" tariff is that:

Should the home country be "large" relative to the world,its imposition of a tariff on imports would lead to an increase in domestic welfare if the terms-of-trade effect exceeds the sum of the:

Which of the following is true concerning a specific tariff?

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:

If a "small" country levies a tariff on an imported good,its overall welfare increases if the monetary value of the tariff's consumption effect plus protective effect is less than the monetary value of the terms-of-trade effect.

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,the total value of Mexico's imports equal:

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 -According to Figure 4.1,Mexican manufacturers gain ____ because of the tariff.

Suppose that the tariff on imported steel is 40 percent,the tariff on imported iron ore is 20 percent,and 30 percent of the cost of producing a ton of steel consists of the iron ore it contains.The effective rate of protection of steel is approximately 49 percent.

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.After the tariff,domestic value added equals:

A beggar-thy-neighbor policy is the imposition of:

The imposition of tariffs on imports results in deadweight welfare losses for the home economy.These losses consist of the:

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.Prior to the tariff,the total price of imported VCRs is:

Unlike a specific tariff,an ad valorem tariff differentiates between commodities with different values.

Although tariffs on imported steel may lead to job gains for domestic steel workers,they can lead to job losses for domestic auto workers.

Table 4.1. Production Costs and Prices of Imported and Domestic VCRs -Consider Table 4.1.The effective tariff rate equals:

The most vocal political pressure for tariffs is generally made by:

the International Economy and Globalization

Foundations of Modern Trade Theory: Comparative Advantage

Sources of Comparative Advantage

Nontariff Trade Barriers

Trade Regulations and Industrial Policies

Trade Policies for the Developing Nations

Regional Trading Arrangements

International Factor Movements and Multinational Enterprises

the Balance of Payments

Foreign Exchange

Exchange-rate Determination

Balance-of-payments Adjustments

Exchange-rate Adjustments and the Balance of Payments

Exchange-rate Systems and Currency Crises

Macroeconomic Policy in an Open Economy

International Banking: Reserves, debt, and Risk

Filters