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practicetest_iei5 - Name Class Date Practice Test Chapter 5...

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Name: ________________________ Class: ___________________ Date: __________ ID: A 1 Practice Test Chapter 5 Fall 2007 Multiple Choice Identify the letter of the choice that best completes the statement or answers the question. ____ 1. Suppose the United States and Japan enter into a voluntary export agreement in which Japan imposes an export quota on its automakers. The largest share of the export quota's "revenue effect" would tend to be captured by: a. The U.S. government b. Japanese automakers c. American auto consumers d. American autoworkers ____ 2. Suppose the government grants a subsidy to domestic producers of an import-competing good. The subsidy tends to result in deadweight losses for the domestic economy in the form of the: ____ 3. Tariffs and quotas on imports tend to involve larger sacrifices in national welfare than would occur under domestic subsidies. This is because, unlike domestic subsidies, import tariffs and quotas: a. Permit less efficient home production b. Distort choices for domestic consumers c. Result in higher tax rates for domestic residents d. Redistribute revenue from domestic producers to consumers ____ 4. The imposition of a domestic content requirement by the United States would cause consumer surplus for Americans to: ____ 5. Domestic content legislation applied to autos would tend to: ____ 6. Compared to an import quota, an equivalent tariff may provide a less certain amount of protection for home producers since: a. A tariff has no deadweight loss in terms of production and consumption b. Foreign firms may absorb the tariff by offering exports at lower prices c. Tariffs are effective only if home demand is perfectly elastic d. Quotas do not result in increases in the price of the imported good ____
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