Economics MCQs

Page No. 356

For advanced countries such as the United States, tariffs on imported raw materials tend to be ?


aequals to tariffs on imported manufactured goods


blower than tariffs on imported manufactured goods


c higher than tariffs on imported manufactured goods


dThe highest of all tariffs



A tax of 15 percent per imported item would be an example of a (an) ?


aAd valorem tariff


bSpecific tariff


c Effective tariff


d Compound tariff


View Answer Ad valorem tariff

The national security argument for protection is more likely to be valid when ?


aThe purpose is to maintain protection for an indefinite time period


bThe industry is characterized by increasing returns to scale


cThe economy operates during a recession


d The protected industry provides invaluable goods during periods of war



If no imported inputs (hard-disk drive) go into the domestic production of a final product (desktop computer) then the ?


anominal tariff rate on the final product equals the effective tariff rate on the product


bnominal tariff rate on the final product is greater than the effective rate on the product


cnominal tariff rate on the final product is less than the effective tariff rate on the final product


dNone of the above



Suppose that the offshore assembly provisions (OAP) of the United States are granted to finished computers that are imported and produced domestically This policy will tend to ?


a cause foreign assemblers of computers to use more computer components that are supplied by countries other than the United States


b Increase the Price of computers to consumers in the United States


cIncrease the Production of computers in the United States


dIncrease the production of computer components in the United States



A tariff ______ increase a country overall welfare?


awill always


bwill never


ccan sometimes


d None of the above


View Answer can sometimes

If a country an imposes an import tariff, its welfare can improve if ?


athe country is a small country rather than a larger country


bits terms of trade improve enough


cThe tariff enhances the welfare of its trading partners


dIts government’s tax revenue increases because of the tariff



If a small country imposes a tariff on an imported good, its terms of trade will ?


a improve


bworsen


c not change


dany of these


View Answer not change

A tariff of ________ would be prohibitive causing imports to fall to zero?


a $10


b$15


c $20


d $25


View Answer $15

The deadweight cost of the tariff equals ?


a$10,000


b$25,000


c$50,000


d $75,000


View Answer $50,000

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