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WorksheetsFree Trade and Protectionism (IB)
Total questions: 30
Worksheet time: 3600secs
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Following the imposition of a tariff, the revenue earned by the government is equal to
j
i,j,k,l
f,j
f
Following the imposition of a tariff, the loss in consumer surplus is shown by the area(s)
m
e,e
m,e,f,g
h,i,j,k,l
The welfare loss as a result of the imposition of a tariff is shown by the areas
e,g
e,f,g
e,i,g,k
m,e,f,g
The value of consumer expenditure on imports following the imposition of a tariff is shown by
f,j
e,f,g
i,j,k
e,i,g,k
Without the imposition of a quota, the revenue earned by foreign firms is shown by the areas
a,f
c,d
b,c,d,e
a,b,c,d,e,f
The size of the quota is shown by the difference between
Q1 and Q2
Q2 and Q3
Q2 and Q5
Q3 and Q4
Consumers lose out from the quota being imposed because
Supply increases from S(domestic) to S(domestic+quota) but without a fall in the price
They could previously purchase Q5 but can only buy Q4 at a higher price at P(quota)
Price increases from P(quota) to P(e)
Output drops from Q5 to Q2
The cost of the subsidy to the government is
$1,000,000
$3,000,000
$5,000,000
$6,000,000
The volume of exports before and after the subsidy are
40,000kg and 20,000kg respectively
20,000kg and 40,000kg respectively
10,000kg and 20,000kg respectively
20,000kg and 10,000kg respectively
Under free trade with the subsidy, domestic consumers spent a total amount of
$1,000,000
$4,000,000
$5,000,000
$6,000,000
After the granting of the subsidy, how much did domestic consumers spend on imports?
$1,000,000
$2,000,000
$5,000,000
$6,000,000
Brazil and Argentina are members of Mercosur, a trading bloc that removes all trade barriers between them, sets a common trade policy for non-member nations, and allows for the free movement of labour and capital from one country to the other. What type of trading bloc is Mercosur?
Free trade area
Preferential trade agreement
Common market
Monetary union
Free trade area
Common market
Monetary union
Complete political and economic integration
