EC 340 exams Essays

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EC340 Midterm Exam #2 Instructions: 1. Please remember to fill in your name, PID number and section number on the scantron. You do not need to fill in a form number. 2. Non-programmable calculators are allowed. Neither books nor notes are allowed. 3. You need to turn in both the scantron and your exam. 4. There are 40 multiple-choice questions on the exam. Each question is worth 2.5 points. -------------------------------------------------------------------------------------------------------------1. The United States recently levied tariffs on tires imported from what country? A) Japan B) Brazil C) Russia D) China 2. Most favored nation status requires: A) a WTO member that reduces a tariff on imports from one WTO trading…show more content…
D) Both Finnish steel producers and steel consumers will be better off with the tariff than without it. 12. Which of the following is NOT an effect of an import tariff? A) It increases producer surplus by raising the domestic price and allowing more production. B) It raises government revenue. C) It reduces consumer surplus by raising the domestic price. D) It may improve the social welfare when it saves high-paying jobs. 13. When a tariff is imposed, there is always an additional loss. One loss occurs when consumers purchase fewer units of the good because prices have risen, so society loses the value of that consumption. This loss is the: A) consumption loss. B) efficiency loss. C) production loss. D) transfer from domestic consumers to domestic producers. Page 3 14. The politics behind tariff protection suggests that, other things equal, tariffs are more likely to be imposed when the: A) benefits to consumers and producers are concentrated on specific firms and states. B) benefits to producers and their labor forces are concentrated on specific firms and states. C) benefits to producers and their labor forces are spread nationwide D) losses to consumers are concentrated on specific firms and states. 15. Tariffs are used to: A) collect government revenue. B) manipulate world prices (in the case of a large country). C) encourage

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