Question 1

How large a tariff did Donald Trump, the Republican candidate in the 2016 presidential campaign, indicate that he would levy on Chinese exports to the United States?

Accepted Answer

A)   10%
B)   25%
C)   45%
D)   75%

Question 2

Suppose that the equations S = 2P and D = 6 - P represent a small country's home supply and home demand curves. If the world price is $1, which of the following is the increase in the country's welfare when it trades compared with autarky?

Accepted Answer

A)   $6.00
B)   $4.50
C)   $1.50
D)   $0.50

Question 3

When a large nation imposes a tariff on a smaller nation and causes its terms of trade to deteriorate, the tariff is sometimes referred to as:

Accepted Answer

A)   a beggar-thy-neighbor tariff.
B)   a hate-thy-neighbor tariff.
C)   a love-thy-neighbor tariff.
D)   an aid-thy-neighbor tariff.

Question 4

We can measure producer and consumer surplus by looking at a graph of supply and demand. Consumer surplus is:

Accepted Answer

A)   the area above the supply curve but below the equilibrium price.
B)   the area below the demand curve but greater than the equilibrium price.
C)   the area below the demand curve all the way down to the quantity axis.
D)   the combined triangular area below the demand curve and above the supply curve.

Question 5

How high was the U.S. tariff on imported tires from China and when did it expire?

Accepted Answer

The U.S. tariff on imported tires from C...

Question 6

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _____________ foreign supply curves, and small countries face ______________ foreign supply curves.

Accepted Answer

A)   perfectly price elastic; upward-sloping
B)   upward-sloping; perfectly price elastic
C)   downward-sloping; perfectly price elastic
D)   upward-sloping; downward-sloping

Question 7

In the 1980s, the United States negotiated a voluntary export agreement with Japan in which each Japanese auto producer voluntarily agreed to reduce the number of its automobiles exported to the United States. This voluntary export agreement caused each Japanese auto producer to:

Accepted Answer

A)   raise the prices of its automobile exports to the United States.
B)   lower the prices of its automobile exports to the United States.
C)   not change the prices of its automobile exports to the United States.
D)   increase the number of automobiles exported to the United States.

Question 8

The United States applies a 25% tariff on imported pickup trucks (mainly from Japan) . If the United States is considered to be a "large" country, then:

Accepted Answer

A)   the U.S. price of imported Japanese pickup trucks will increase by 25%.
B)   the U.S. price of imported Japanese pickup trucks will increase by less than 25%.
C)   the U.S. price of imported Japanese pickup trucks will increase by more than 25%.
D)   the U.S. price of imported Japanese pickup trucks will increase by 35%. B

Question 9

(Figure: The Import-Competing Industry)  In the figure, what is the value of producer surplus in the absence of trade?

Accepted Answer

A)   $510.
B)   $150.
C)   $25.
D)   $15.

Question 10

Why do countries persist in using protective measures even though most economists believe that tariffs and quotas yield welfare losses to countries?

Accepted Answer

Countries persist in using protective me...

Question 11

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will ______, and U.S. clothing production will ________.

Accepted Answer

A)   fall; fall
B)   fall; rise
C)   rise; rise
D)   rise; fall

Question 12

If we assume perfect competition in the product markets, producer surplus is:

Accepted Answer

A)   maximized.
B)   minimized.
C)   equal to the firm's monopoly profits.
D)   equal to the return to the fixed factors of production.

Question 13

In the 1980s, the United States used _________ to restrict imports of Japanese automobiles.

Accepted Answer

A)   quotas
B)   tariffs
C)   voluntary export restraints
D)   antidumping duties

Question 14

Suppose a nation agrees to limit its own exports by imposing quotas on its own firms in order to keep their revenues high, keep from breaking WTO rules, and pacify protectionist interests in the import nation. Which of the following terms describes this practice?

Accepted Answer

A)   lost profit opportunities
B)   reverse import restrictions
C)   voluntary export restraints
D)   deadweight welfare loss

Question 15

If the United States is a large country that imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, what will be the value of T-shirts once they have cleared U.S. customs?

Accepted Answer

If the United States imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, the value of the T-shirts once they have cleared U.S. customs can be calculated by adding the tariff to the original world price.

Here's the calculation:

Tariff amount per T-shirt = 30% of $5 = 0.30 * $5 = $1.50

Therefore, the value of each T-shirt after the tariff is applied would be:

World price + Tariff = $5 + $1.50 = $6.50

So, the value of the T-shirts once they have cleared U.S. customs would be $6.50 per T-shirt.

Question 16

Suppose that the world price of radios is above the no-trade domestic price. In that case, the country:

Accepted Answer

A)   imports radios at the world price.
B)   imports radios at the no-trade domestic price.
C)   exports radios at the world price.
D)   exports radios at the no-trade domestic price.

Question 17

(Figure: Home Market II)  Now suppose that the large country in the graph imposes a tariff. How large is the tariff?

Accepted Answer

A)   $10
B)   $20
C)   $25
D)   $15

Question 18

About how large were the extra deadweight losses incurred by the United States as a result of the discriminatory tariff against imported Chinese tires?

Accepted Answer

The question you're asking refers to a s...

Question 19

How did the WTO react to the U.S. imposition of steel tariffs in 2002?

Accepted Answer

A)   It said that even though the tariffs were high, it was okay because of the escape clause.
B)   It suspended the United States temporarily, stripping it of all its rights in the organization.
C)   It made the United States promise to repeal the tariff as soon as possible.
D)   It allowed other nations to impose tariffs on U.S. exports to retaliate.

Question 20

Who captured the quota rents of the 1980s U.S-Japanese voluntary export agreement for automobiles?

Accepted Answer

A)   Japanese auto producers
B)   U.S. consumers of Japanese automobiles
C)   U.S. auto producers
D)   the U.S. government A

Exam 8: Import Tariffs and Quotas Under Perfect Competition

How large a tariff did Donald Trump, the Republican candidate in the 2016 presidential campaign, indicate that he would levy on Chinese exports to the United States?

Correct Answer
verified

Suppose that the equations S = 2P and D = 6 - P represent a small country's home supply and home demand curves. If the world price is $1, which of the following is the increase in the country's welfare when it trades compared with autarky?

Correct Answer
verified

When a large nation imposes a tariff on a smaller nation and causes its terms of trade to deteriorate, the tariff is sometimes referred to as:

Correct Answer
verified

We can measure producer and consumer surplus by looking at a graph of supply and demand. Consumer surplus is:

Correct Answer
verified

How high was the U.S. tariff on imported tires from China and when did it expire?

Correct Answer
Answered by ExamLex AI
The U.S. tariff on imported tires from C...
View Answer

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _ foreign supply curves, and small countries face __ foreign supply curves.

Correct Answer
verified

In the 1980s, the United States negotiated a voluntary export agreement with Japan in which each Japanese auto producer voluntarily agreed to reduce the number of its automobiles exported to the United States. This voluntary export agreement caused each Japanese auto producer to:

Correct Answer
verified

The United States applies a 25% tariff on imported pickup trucks (mainly from Japan) . If the United States is considered to be a "large" country, then:

Correct Answer
verified
B

(Figure: The Import-Competing Industry) In the figure, what is the value of producer surplus in the absence of trade?

Correct Answer
verified

Why do countries persist in using protective measures even though most economists believe that tariffs and quotas yield welfare losses to countries?

Correct Answer
Answered by ExamLex AI
Countries persist in using protective me...
View Answer

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will , and U.S. clothing production will __.

Correct Answer
verified

If we assume perfect competition in the product markets, producer surplus is:

Correct Answer
verified

In the 1980s, the United States used _________ to restrict imports of Japanese automobiles.

Correct Answer
verified

Suppose a nation agrees to limit its own exports by imposing quotas on its own firms in order to keep their revenues high, keep from breaking WTO rules, and pacify protectionist interests in the import nation. Which of the following terms describes this practice?

Correct Answer
verified

If the United States is a large country that imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, what will be the value of T-shirts once they have cleared U.S. customs?

Suppose that the world price of radios is above the no-trade domestic price. In that case, the country:

Correct Answer
verified

(Figure: Home Market II) Now suppose that the large country in the graph imposes a tariff. How large is the tariff?

Correct Answer
verified

About how large were the extra deadweight losses incurred by the United States as a result of the discriminatory tariff against imported Chinese tires?

Correct Answer
Answered by ExamLex AI
The question you're asking refers to a s...
View Answer

How did the WTO react to the U.S. imposition of steel tariffs in 2002?

Correct Answer
verified

Who captured the quota rents of the 1980s U.S-Japanese voluntary export agreement for automobiles?

Correct Answer
verified
A

Exam 8: Import Tariffs and Quotas Under Perfect Competition

How large a tariff did Donald Trump, the Republican candidate in the 2016 presidential campaign, indicate that he would levy on Chinese exports to the United States?

Correct AnswerverifiedShow Answer

Suppose that the equations S = 2P and D = 6 - P represent a small country's home supply and home demand curves. If the world price is $1, which of the following is the increase in the country's welfare when it trades compared with autarky?

Correct AnswerverifiedShow Answer

When a large nation imposes a tariff on a smaller nation and causes its terms of trade to deteriorate, the tariff is sometimes referred to as:

Correct AnswerverifiedShow Answer

We can measure producer and consumer surplus by looking at a graph of supply and demand. Consumer surplus is:

Correct AnswerverifiedShow Answer

How high was the U.S. tariff on imported tires from China and when did it expire?

Correct AnswerAnswered by ExamLex AIThe U.S. tariff on imported tires from C...View AnswerShow Answer

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _____________ foreign supply curves, and small countries face ______________ foreign supply curves.

Correct AnswerverifiedShow Answer

In the 1980s, the United States negotiated a voluntary export agreement with Japan in which each Japanese auto producer voluntarily agreed to reduce the number of its automobiles exported to the United States. This voluntary export agreement caused each Japanese auto producer to:

Correct AnswerverifiedShow Answer

The United States applies a 25% tariff on imported pickup trucks (mainly from Japan) . If the United States is considered to be a "large" country, then:

Correct AnswerverifiedB

(Figure: The Import-Competing Industry) In the figure, what is the value of producer surplus in the absence of trade?

Correct AnswerverifiedShow Answer

Why do countries persist in using protective measures even though most economists believe that tariffs and quotas yield welfare losses to countries?

Correct AnswerAnswered by ExamLex AICountries persist in using protective me...View AnswerShow Answer

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will ______, and U.S. clothing production will ________.

Correct AnswerverifiedShow Answer

If we assume perfect competition in the product markets, producer surplus is:

Correct AnswerverifiedShow Answer

In the 1980s, the United States used _________ to restrict imports of Japanese automobiles.

Correct AnswerverifiedShow Answer

Suppose a nation agrees to limit its own exports by imposing quotas on its own firms in order to keep their revenues high, keep from breaking WTO rules, and pacify protectionist interests in the import nation. Which of the following terms describes this practice?

Correct AnswerverifiedShow Answer

If the United States is a large country that imposes a 30% tariff on imported T-shirts with a world price of $5 per T-shirt, what will be the value of T-shirts once they have cleared U.S. customs?

Suppose that the world price of radios is above the no-trade domestic price. In that case, the country:

Correct AnswerverifiedShow Answer

(Figure: Home Market II) Now suppose that the large country in the graph imposes a tariff. How large is the tariff?

Correct AnswerverifiedShow Answer

About how large were the extra deadweight losses incurred by the United States as a result of the discriminatory tariff against imported Chinese tires?

Correct AnswerAnswered by ExamLex AIThe question you're asking refers to a s...View AnswerShow Answer

How did the WTO react to the U.S. imposition of steel tariffs in 2002?

Correct AnswerverifiedShow Answer

Who captured the quota rents of the 1980s U.S-Japanese voluntary export agreement for automobiles?

Correct AnswerverifiedA

Correct Answer
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Answered by ExamLex AI
The U.S. tariff on imported tires from C...
View Answer

Foreign supply curves facing a large country differ from those facing a small country. Large countries face _ foreign supply curves, and small countries face __ foreign supply curves.

Correct Answer
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B

Correct Answer
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Answered by ExamLex AI
Countries persist in using protective me...
View Answer

Suppose that the U.S. government imposes a 20% tariff to protect U.S. clothing manufacturers adversely affected by the expiration of the Multifibre Arrangement. Compared with a free-trade situation, the price of clothing in the United States will , and U.S. clothing production will __.

Correct Answer
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Answered by ExamLex AI
The question you're asking refers to a s...
View Answer

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A