Chapter 6
Most tariffs have A) only revenue effects. B) only protective effects. C) both protective and revenue effects. D) neither protective nor revenue effects.
c
Refer to the figure above. With free trade, the total value of imports would equal A) $10. B) $100,000. C) $200,000 D) $300,000.
c
Tariff levels in developing countries tend to be ________ tariff levels in developed countries. A) lower than B) about equal to C) higher than D) there is no general pattern
c
If Canada imposes a tariff on bananas and if none are grown in Canada, this tariff has A) only revenue effects. B) only protective effects. C) both protective and revenue effects. D) neither protective nor revenue effects.
a
Refer to the figure above. With the tariff, the quantity of imports falls to A) 10,000 units. B) 12,000 units. C) 14,000 units. D) 22,000 units.
a
Specific tariffs are collected as A) fixed amounts of money per unit traded. B) a percentage of the price of the product. C) a percentage of the quantity of imports. D) All of the above.
a
The United States imposes tariffs A) only on imports. B) only on exports. C) on both imports and exports. D) on imports, exports, and nontraded goods.
a
The difference between what consumers have to pay for a particular and what they are willing to pay is known as A) consumer surplus. B) producer surplus. C) deadweight costs. D) deadweight surplus.
a
The increase in food prices around the world at the end of the 2000s decade led several developing countries to impose export tariffs on which of the following exports? A) Rice. B) Tomatoes. C) Oil. D) Bananas.
a
A prohibitive tariff has A) only revenue effects. B) only protective effects. C) both protective and revenue effects. D) neither protective nor revenue effects
b
A tariff can ________ raise a country's welfare. A) never B) sometimes C) always
b
Ad valorem tariffs are collected as A) fixed amounts of money per unit traded. B) a percentage of the price of the product. C) a percentage of the quantity of imports. D) All of the above.
b
Following the imposition of the Smoot-Hawley tariff A) international trade continued to expand. B) more than 40 countries imposed higher tariffs of their own. C) employment in the United States expanded rapidly. D) Two of the above.
b
If a tariff of $10 has no effect on the world price, the optimal tariff on that product A) is $10. B) is zero. C) is higher than $10. D) depends upon the amount of government revenue collected.
b
) If a tariff on bikes causes domestic bike prices to rise by 20% and domestic value added in the domestic bike industry to rise by 30%, then A) the nominal rate of protection of bikes is 20%. B) the effective rate of protection of bikes is 30%. C) the effective rate of protection is higher than the nominal rate. D) All of the above.
d
) In developed countries, tariffs on raw materials tend to be A) highest of all. B) higher than on manufactured goods. C) equal to tariffs on manufactured goods. D) lower than on manufactured goods.
d
Refer to the figure above. Domestic producers gain ________ because of the tariff. A) $5 B) $62,500 C) $15 D) $125,000
b
Refer to the figure above. The deadweight cost of the tariff equals A) $10,000. B) $25,000. C) $50,000. D) cannot be calculated without further information.
b
Refer to the figure above. With free trade, the total quantity of imports would equal A) 10,000 units. B) 20,000 units. C) 22,000 units. D) 30,000 units.
b
________ gains from trade refer to the situation where, over time, international trade leads to an outward shift in a country's production possibility frontier. A) Static B) Dynamic C) Political D) Outward
b
) In today's world, many countries impose tariffs A) only on imports. B) only on exports. C) on both imports and exports. D) on imports, exports, and nontraded goods.
c
A country gains from international trade if its post-trade ________ point lies outside its production possibility frontier. A) production B) autarky C) consumption D) All of the above
c
As of 2008, with which of the following countries did the U.S. not have a preferential trade agreement? A) Mexico. B) Canada. C) Russia. D) Israel.
c
If Brazil imposes a 50% tariff on automobiles and a 25% tariff on motors, the effective rate of protection on autos is A) higher than the nominal rate of protection on autos. B) need more information to answer. C) lower than the nominal rate of protection on autos. D) equal to the nominal rate of protection on autos.
c
All countries tend to have about the same tariff levels.
false
Export tariffs are generally supported by business interests
false
a country can never raise its standard of living by imposing a tariff
false
deadweight costs of tariffs equals the sum of net changes in consumer and producer surplus brought about by the tariff
false
examples from the US suggests that the cost to consumers per job saved in highly protected industries is low
false
Although current U.S. tariffs are quite low on average, tariffs remain high for some products
true
Free trade is better than protection for a small country
true
In order to provide alternatives to drug-crop production, the Andean Trade Preference Act (ATPA) was created, providing Bolivia, Colombia, Ecuador, and Peru tariff free access to U.S. markets for many goods.
true
Static gains from trade come about because trade causes consumers and producers to face a different set of prices
true
The deadweight costs of an export tariff have similar interpretations to those of an import tariff.
true
an increase in the tariff on semiconductors lowers the effective rate of protection on computer producers
true
free trade is better than autarky for a small country
true
tariffs tend to escalate with stages of processing
true
) Refer to the figure above. With the tariff, the government collects A) $50,000. B) $60,000. C) $100,000. D) $220,000.
a
) Which of the following countries imposes significant tariffs on its agricultural exports? A) Argentina B) The U.S. C) Canada D) France.
a
Refer to the figure above. A tariff of ________ would be purely protective. A) $0 B) $5 C) $8 D) $10
d
The United States charges A) the same tariff rates on goods from all countries. B) lower tariff rates on goods from countries with most favored nation status. C) low or zero tariffs on goods from certain developing countries. D) Both B and C.
d
