Economic theory in general, and trade theory in particular are replete with equivalencies
For example, it is argued that for any specific tariff one can find an equivalent ad valorem tariff; and that for any quota one can calculate a tariff equivalent. Discuss conditions or situations under which a specific and an ad valorem tariff are not equivalent. Discuss conditions or situations when a tariff and a quota are not equivalent.
E.g., during a period of price inflation, an ad valorem tariff would become increasingly more effective. The government does not receive any of the quota revenues, unless the import licenses are sold or auctioned.
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All else equal, a decrease in the rate of inflation ________ aggregate spending and ________ short-run equilibrium output.
A. decreases; decreases B. increases; increases C. decreases; increases D. increases; decreases
In the above figure, what would result if the price was $40?
A) a surplus B) a shortage C) equilibrium D) excess demand
According to the graph shown, if this economy were an autarky, producers would enjoy area:
This graph demonstrates the domestic demand and supply for a good, as well as the world price for that good.
A. A.
B. ABC.
C. H.
D. HDE.
Higher indifference curves represent lesser satisfaction
a. True b. False Indicate whether the statement is true or false