1. According to the standard model, the change in the economic welfare of a country associated with an increase in a tariff is equal to A. Terms of trade gain minus efficiency loss of distortions. B. Efficiency gain minus terms of trade loss. C. Efficiency loss plus tax revenue gain. D. Efficiency loss plus tax revenue gain plus terms of trade gain. E. None of the above.

1. According to the standard model, the change in the economic welfare of a country associated with an increase in a tariff is equal to A. Terms of trade gain minus efficiency loss of distortions. B. Efficiency gain minus terms of trade loss. C. Efficiency loss plus tax revenue gain. D. Efficiency loss plus tax revenue gain plus terms of trade gain. E. None of the above.

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 32CTQ: Occasionally, a government official will argue that a country should strive for both a trade surplus...

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