Question : 19.4   Trade Barriers: Tariffs, Export Subsidies, and Quotas 1) A tariff : 1381276

19.4   Trade Barriers: Tariffs, Export Subsidies, and Quotas

1) A tariff is

A) a limit on the quantity of a good that can be imported into a country.

B) a tax on imports.

C) a government payment made to domestic firms to encourage exports.

D) a payment made by the government to producers of the product.

2) Government payments made to domestic firms in order to encourage exports are called

A) tariffs.

B) bribes.

C) quotas.

D) subsidies.

3) It costs a computer manufacturer $1,000 to produce a personal computer. This manufacturer sells these computers abroad for $600. This is an example of

A) a negative tariff.

B) export subsidy.

C) dumping.

D) a trade-related economy of scale.

4) If the United States decreases the tariff on imported tuna steaks, this will

A) reduce the number of tuna steaks imported into the United States and reduce production of tuna steaks in the United States.

B) increase the number of tuna steaks imported in the United States and increase the production of tuna steaks in the United States.

C) reduce the number of tuna steaks imported in the United States and increase the production of tuna steaks in the United States.

D) increase the number of tuna steaks imported in the United States and reduce the production of tuna steaks in the United States.

5) The United States placed a limit on the amount of cars that can be imported into the United States. This is an example of

A) a tariff.

B) an export subsidy.

C) a quota.

D) dumping.

6) Which of the following is TRUE?

A) An import quota generates government revenue.

B) Tariffs on imports generate government revenue as long as the domestic price is larger than the world price plus the tariff.

C) Tariffs on imports do not generate government revenue if the domestic price is larger than the world price plus the tariff.

D) Tariffs on imports never generate government revenue.

7) Which of the following statements is FALSE?

A) If the United States imposes a tariff on Japanese car imports, the price of cars in the United States is likely to increase.

B) If the United States imposes a quota on Japanese car imports, the price of cars in the United States is likely to increase.

C) If Japan imposes a subsidy on car exports to the United States, the price of cars in the United States is likely to increase.

D) If Japan imposes a “voluntary export restraint” on car exports to the United States, the price of cars in the United States is likely to increase.

8) Dumping involves a country selling its exports

A) at a price lower than its cost of production.

B) to nations without a comparative advantage in producing the products.

C) to nations that regularly impose tariffs.

D) to nations that have no need for the products.

9) The U.S. tariff law that set off an international trade war in the 1930s was the

A) Taft-Hartley tariff.

B) Bentsen-Gephardt tariff.

C) Smoot-Hawley tariff.

D) Landrum-Griffin tariff.

10) The international agreement signed by the United States and 22 other countries in 1947 to promote the liberalization of foreign trade is known by its initials as

A) GATT.

B) START.

C) SALT.

D) IMF.