1. The imposition of tariffs on imports results in deadweight welfare losses for the home economy. These losses consist

Notes

1. The imposition of tariffs on imports results in deadweight welfare losses for the home economy. These losses consist of the a. protective effect and the consumption effect. b. redistribution effect and the revenue effect. c. revenue effect and the protective effect. d. consumption effect and the redistribution effect. ANSWER: a 2. Suppose that the United States eliminates its tariff on steel imports, permitting foreign-produced steel to enter the U.S. market. Steel prices to U.S. consumers would be expected to a. increase, and the foreign demand for U.S. exports would increase. b. decrease, and the foreign demand for U.S. exports would increase. c. increase, and the foreign demand for U.S. exports would decrease. d. decrease, and the foreign demand for U.S. exports would decrease. ANSWER: b 3. A $100 specific tariff provides home producers more protection from foreign competition when a. the home market buys cheaper products rather than expensive products. b. it is applied to a commodity with many grade variations. c. the home demand for a good is elastic with respect to price changes. d. it is levied on manufactured goods rather than primary products. ANSWER: a 4. The price of ...