Protectionism

Which method of protection raises revenue for the government?

• domestic subsidies

• embargo

• quota

• tariff

An argument against trade protectionism is that it will increase

• competition for domestic industries

• domestic price level

• the current account deficit

• opportunities for domestic infant industries

what would reduce an economy's protection against the import of cars?

• a lower exchange rate

• a higher quotas imported cars

• a higher tariff on imported cars

• higher subsidy for domestic car producers

What would be an economic benefit to a country of imposing a tariff on imported goods?

• A it would increase global productivity

• B it would make the country's exports more competitve

• C it would put pressure on foreign suppliers to reduce their prices

• It would reduce the prices paid by consumers for imported goods

Which of the following is NOT an argument in favor of protectionism?

• Protectionism shields infant industries from foreign competition

• Protectionism safeguards workers’ jobs

• Protectionism promotes industries that are essential to national security

• Protectionism makes domestic firms more competitive in the long run

An import quota is a

• tax on import quantities above the legal limit.
• way to increase tariff revenues for the exporting country.
• legal limit on the amount of a good that can be imported into a country.
• legal incentive for members of WTO to increase their exports of a good or service.

A tax or duty that raises the price of imported products is a .....

• Quota

• Tariff

• Embargo

• Subsidy

Tariffs are used to protect “Infant Industries”

• True

• False

Countries may impose tariffs on imports to retaliate to the protectionist policies of another country. This is called a Trade War.

• True

• False

Quotas are not popular with consumers because they limit consumer choice. This makes products more expensive.

• False

• True