Domestic producers of tires send a lobbyist to the U.S. government to request that the government impose trade restrictions on imports of tires. The lobbyist claims that the U.S. tire industry is new and cannot currently compete with foreign firms. However, if trade restrictions were temporarily imposed on tires, the domestic tire industry could mature and adjust and would eventually be able to compete in the world market. Which of the following justifications is the lobbyist using to argue for the trade restriction on tires? Jobs argument O Unfair-competition argument Infant-industry argument O Using-protection-as-a-bargaining-chip argument O National-security argument

Domestic producers of tires send a lobbyist to the U.S. government to request that the government impose trade restrictions on imports of tires. The lobbyist claims that the U.S. tire industry is new and cannot currently compete with foreign firms. However, if trade restrictions were temporarily imposed on tires, the domestic tire industry could mature and adjust and would eventually be able to compete in the world market. Which of the following justifications is the lobbyist using to argue for the trade restriction on tires? Jobs argument O Unfair-competition argument Infant-industry argument O Using-protection-as-a-bargaining-chip argument O National-security argument

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Sujee International Trade - End of Chapter Problem The United States is the fifth largest sugar consumer and the fifth largest sugar producer in the world. The U.S. sugar industry has enjoyed trade protection since 1789 when Congress enacted the first tariff against foreign-produced sugar. The accompanying graph depicts the supply and demand for sugar in the United States in 2019. The world price for sugar was $0.12 per pound. a. The United States enacts an import tariff of 6 cents per pound. In the accompanying graph, place the line labeled "World price + tarill" in the graph to reflect this tariff. Price (cesta per pound) 52 54 48 24 18 D 0 B Market for sugar Domestic supply 19 24 Quantity (billions of pounds) CS d. Given the tarill, quantity demanded will be pounds. U.S. imports will therefore be PS e. As a result of the tariff, consumer surplus will economic surplus will GR World Price + tarif b. Next, using the shapes in the graph, shade the areas that represent consumer surplus…
In 1932, U.S. manufacturers, which used to enjoy steady relationships with their foreign distributors and export nearly 60% of their output, realized that their exports had fallen to only 20% of total output. Which of the following is the most likely reason for this decrease in exports? O The low quality of U.S. products O war between the United States and Canada O Retaliatory tariffs by trading partners The signing of the General Agreement on Tariffs and Trade (GATT) in 1947 resulted in the adoption of several new trade policies. In the following table, indicate if each of the policies listed was a result of GATT. Then, complete the last column by identifying the means by which each GATT policy was implemented. Policy GATT Policy Implementation Promotion of protectionism Clear and public trade rules Promotion of lower trade barriers Yes v Institution of the WTO Promotion of trade transparency Settling trade disputes In the 1960s, multilateral negotiations called the Uruguay Round…
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4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for maize in Panama. The world price (Pw) of maize is $260 per ton and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. 440 Domestic Demand Domestic Supply 420 400 380 360 340 320 300 280 Pw 260 240 40 80 120 160 200 240 280 320 360 400 QUANTITY (Tons of maize) PRICE (Dollars per ton)
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for maize in Panama. The world price (Pw) of maize is $260 per ton and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. (? 500 Domestic Demand Domestic Supply 470 440 410 380 350 320 290 P 260 230 200 20 40 60 80 100 120 140 180 180 200 QUANTITY (Tons of maize) If Panama is open to international trade in maize without any restrictions, it will import tons of maize. Suppose the Panamanian government wants to reduce imports to exactly 40 tons of maize to help domestic producers. A tariff of $ per ton PRICE (Dollars per ton)
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2. Uganda is a small of Uganda country. The government wants to protect domestic producers of rice by imposing a quota, an ad valorem tariff or an equivalent specific tariff. The three trade barriers would be equivalent in the sense that either one will initially limit imports to a given amount. Once either of these measures is imposed, the government will not switch to a different measure or change its magnitude. Suppose the world supply of rice (relative to the world demand for rice) is expected to increase in the future. You are a lobbyist for producers of rice in Uganda and you only care about their interests. Which trade barrier would you advocate on their behalf - a quota, an ad valorem tariff, or a specific tariff? Which one would you advocate next? Explain carefully using a numerical example. (Feel free to use a graph as well if you want.) (Consider ONLY the interests of PRODUCERS of rice in Uganda.)