Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 9, Problem 5MCQ
To determine
The correct option in case of U.S. tariff on paper.
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How does the imposition of an import tariff
by a country affect its domestic market for
the imported goods?
A. It increases the domestic supply, leading.
to lower prices.
B. It decreases the domestic supply, leading
to higher prices.
C. It increases the domestic demand, leading
to higher prices.
D. It decreases the domestic demand,
leading to lower prices.
If higher tariffs, such as those enacted by the Smoot-Hawley trade bill, reduce the imports of the United States, which of the following will
be most likely to occur?
a. U.S. employment will increase.
b. The unemployment rate of the United States will decline.
c. U.S. exports will increase because foreigners will want to buy more from U.S. producers.
d.
U.S. exports will decline because foreigners will be earning fewer of the dollars needed to purchase goods and services from
Americans.
Assume Australia is an importer of sofas and there are no trade restrictions. Australian consumers buy 1 000 000 sofas per year, of which 450 000 are produced domestically and 550 000 are imported.a Suppose that a technological advance among Swedish sofa manufacturers causes the world price of sofas to fall by $200. Draw a graph to show how this change affects the welfare of Australian consumers and Australian producers, and how it affects total surplus in Australia.b After the fall in price, Australian consumers buy 1 150 000 sofas, of which 300 000 are produced domestically and 850 000 are imported. Calculate the change in consumer surplus, producer surplus and total surplus from the price reduction.c If the government responded by putting a $200 tariff on imported sofas, what would this do? Calculate the revenue that would be raised and the deadweight loss. Would it be a good policy from the standpoint of Australian welfare? Who might support the policy?d Suppose that the fall in…
Chapter 9 Solutions
Foundations of Economics (8th Edition)
Ch. 9 - Prob. 1SPPACh. 9 - Prob. 2SPPACh. 9 - Prob. 3SPPACh. 9 - Prob. 4SPPACh. 9 - Prob. 5SPPACh. 9 - Prob. 6SPPACh. 9 - Prob. 7SPPACh. 9 - Prob. 8SPPACh. 9 - Prob. 9SPPACh. 9 - Prob. 10SPPA
Ch. 9 - Prob. 11SPPACh. 9 - Prob. 1IAPACh. 9 - Prob. 2IAPACh. 9 - Prob. 3IAPACh. 9 - Prob. 4IAPACh. 9 - Prob. 5IAPACh. 9 - Prob. 6IAPACh. 9 - Prob. 7IAPACh. 9 - Prob. 8IAPACh. 9 - Prob. 9IAPACh. 9 - Prob. 1MCQCh. 9 - Prob. 2MCQCh. 9 - Prob. 3MCQCh. 9 - Prob. 4MCQCh. 9 - Prob. 5MCQCh. 9 - Prob. 6MCQCh. 9 - Prob. 7MCQ
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- Assume Australia is an importer of sofas and there are no trade restrictions. Australian consumers buy 1 000 000 sofas per year, of which 450 000 are produced domestically and 550 000 are imported.a Suppose that a technological advance among Swedish sofa manufacturers causes the world price of sofas to fall by $200. Draw a graph to show how this change affects the welfare of Australian consumers and Australian producers, and how it affects total surplus in Australia.b After the fall in price, Australian consumers buy 1 150 000 sofas, of which 300 000 are produced domestically and 850 000 are imported. Calculate the change in consumer surplus, producer surplus and total surplus from the price reduction.c If the government responded by putting a $200 tariff on imported sofas, what would this do? Calculate the revenue that would be raised and the deadweight loss. Would it be a good policy from the standpoint of Australian welfare? Who might support the policy?d Suppose that the fall in…arrow_forwardCalculate the loss in mexico consumer surplus due to the tariff. A) $225 B) $265 C) $285 D) $325arrow_forwardThe nation of Theopolis recenty put a tariff on the importation of washing machines. Which of the following statements is true based on this information? (a) This tariff harms consumers in Theopolis who buy washing machines (b) This tariff benefts the producers of washing machines in Theopolis (c) This tarif hurts the producers of washing machines in other countries that export to Theopolis (d) The tariff will increase overall weltare in Theopolis Explain all the false answers alsoarrow_forward
- The effect of imposing a tariff on a specific imported good is to the domestic price of the good and the domestic production of the good. Select one: a. increase; increase b. decrease; increase c. decrease; decrease d. decrease; to leave unaffected.arrow_forwardits already answered on this site just send it to mearrow_forwardwhat is tariff and how does it effect the economyarrow_forward
- When a tariff is imposed on a good, the price to consumers _____ and the amount imported _____.arrow_forwardSuppose the nation of Isoland is an importer of textiles and is looking for a way to raise government revenue. The following graph shows the effect of a tariff on textile imports.arrow_forward1arrow_forward
- Using the graph, assume that the government imposes a $1 tariff on hammers, Answer the following questions given this information, (see the attached pictures.)arrow_forwardThe 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 + tariff" in the graph to reflect this tariff. Market for sugar 60 CS 54 PS 48 Domestic supply 42 GR 36 30 24 18 World Price + tariff 12 6. Domestic demand Price (cents per pound)arrow_forwardThe box said higher or lower for the 1 question an OA. win: lose OB. lose: win OC. lose: lose OD. win: win The United States exports athletic coaching services and imports coffee. The price of athletic coaching services in the United States is without international trade. As a result of trade in athletic coaching services, U.S. producers of athletic coaching services and U.S. consumers of athletic coaching services Click to select your answer. Show Transcribed Text The box said higher or lower for the 1 question 5 OA win; lose OB. lose; win OC. win: win OD. lose; lose C 3 C The price of coffee in the United States is trade. As a result of trade in coffee, the U.S. producers of coffee with international trade than with international trade than without international and U.S. consumers of coffee T tri Aarrow_forward
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