Multiple
Choice Questions
1
Japanese tariffs and quotas reduce national welfare the
most in:
A)
agriculture
B)
machinery
C)
textiles
D)
clothing
2
US tari?s and quotas reduce national welfare the most
in:
A)
agriculture
B)
machinery
C)
textiles
D)
clothing
3
The pattern of protection in industrial countries is
particularly harmful to the interests of
A)
low-income developing countries
B)
high-income industrial countries
C)
Asian nations
D)
European nations
4
One reason why consumers are unlikely to be too upset
about tari?s is because
A)
most consumers benefit from protection
B)
tari?s are an inexpensive way to create jobs
C)
consumer losses are not real losses
D)
the costs are so spread out that no one pays a big share
of the total
5
One reason why producers have an incentive to organize in
favor of protection is because
A)
producer gains are spread across so many firms that no
one gets a large share of the benefits
B)
producer gains are relatively concentrated
C)
there is no real cost to the economy
D)
producer gains outweigh consumer losses
A countervailing duty is a tari? that is levied to
counteract
A)
the dumping of goods in the domestic market by foreign
firms
B)
a sudden surge of imports which hurt a domestic industry
C)
subsidies given to foreign firms by their own
governments
D)
the tari? on domestic goods that are enacted by foreign
governments
7
Dumping occurs when a firm
A)
sells too much of a good in a foreign country
B)
sells in a foreign country at prices that are below fair
value
C)
sells in its home market at prices that are below the average
price charged by its competitors
D)
sells in a foreign market at prices that are below the
prices charged by firms based in the foreign market
8
If a country faces action under Section 301 of the US
Trade Act of 1974, it means that the country has
A)
exceeded average import growth by more than 301 percent
B)
exceeded average export growth by more than 301 percent
C)
tari?s that are above 301 percent
D)
been charged by the United States with systematically
engaging in unfair trade practices
9
Which of the following is TRUE?
A)
In the European Union, the largest national welfare loss
from protection was in textiles
B)
In Japan, the highest costs per job saved from protection
were in agriculture
C)
In the United States, the largest national welfare loss
from protection was in agriculture
D) In
the European Union, the highest costs per job saved from protection were in
agriculture
10
Since the phase-in of the Uruguay Round, average tari?s
have
A)
stayed the same, but the disparity in individual nationâs
tari?s have been reduced
B)
fallen 5 percent
C)
fallen 40 percent
D)
fallen more than 80 percent