At free-trade prices, a tennis racquet in Country A, a small country, sells for $100 and contains $40 worth of aluminum inputs and $30 worth of plastic. In Country A, the nominal tariff rates are 40 percent on tennis racquets, 20 percent on aluminum, and 10 percent on plastic. Based on this information, what is the effective rate of protection for the racquet industry in Country A?
A. 10%
B. 40%
C. 133?%
D. 96?%
Answer: D
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A) increases but not decreases of a variable. B) the difference between the maximum value of the variable and the minimum value of the variable. C) a general tendency for a variable to rise or fall. D) the scale used on the x- and y-axes. E) decreases but not increases of a variable.
An increase in real GDP
A) increases the buying and selling of goods and decreases the demand for money as a medium of exchange. B) decreases the buying and selling of goods and decreases the demand for money as a medium of exchange. C) decreases the buying and selling of goods and increases the demand for money as a medium of exchange. D) increases the buying and selling of goods and increases the demand for money as a medium of exchange.
Who receives the most of what is produced in a market economy?
A) everyone receives an equal amount B) people who earn the highest incomes C) lawmakers and other politically favored groups D) those who are willing and able to buy them
Total welfare gains from trade to the economy can be measured: a. as the sum of consumer and producer surpluses
b. as the difference between producer surplus and consumer surplus. c. as the sum of consumer and producer surpluses minus taxes d. as the net gain in consumer surplus that results from an action that alters a market equilibrium.