Chap014

Chap014 - Chapter 14 - The Impact of Trade Policies Chapter...

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Chapter 14 - The Impact of Trade Policies Chapter 14 The Impact of Trade Policies Multiple Choice Questions FIGURE 1 1. Figure 1 shows the situation of a small country with free-trade in an imported product (at a price of $10) and the situation with a tariff on the product (at a price of $11). In this graph, the net welfare loss (or total deadweight loss) to the country from the imposition of the tariff is __________. a. $2 B . $6 c. $32 d. $44 2. In Figure 1, showing the situation of a small country with free-trade in an imported product (at a price of $10) and the situation with a tariff on the product (at a price of $11), what is the amount of tariff revenue collected by the government when the tariff is in place? a. $3 B . $6 c. $18 d. $40 14-1
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3. In Figure 1, showing the situation of a small country with free-trade in an imported product (at a price of $10) and the situation with a tariff on the product (at a price of $11), suppose that a subsidy to import-competing producers is given instead of a tariff being imposed. The subsidy is set to generate the same amount of domestic production of the good as occurred under the tariff. What would be the net welfare loss to the country in this situation? A . $2 b. $6 c. $12 d. $34 4. In the following import graph, if horizontal supply line Sm shifts to horizontal line S'm because of the imposition of a tariff, a. The situation must be one of a "large" importing country b. The tariff must be a specific tariff
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This note was uploaded on 11/27/2009 for the course ECON 421 taught by Professor Macphee,c during the Spring '08 term at UNL.

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Chap014 - Chapter 14 - The Impact of Trade Policies Chapter...

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