Non-Tariff Trade Barriers MCQs

Option A: General Motors, the manufacturer of automobiles

Option B: Tennessee Mining Co. an iron-ore mining company

Option C: Caterpillar Corp the producer of earth moving equipment

Option D: Sneva Construction Co. The builder of skyscrapers

Correct Answer: Tennessee Mining Co. an iron-ore mining company ✔

Option A: import quota

Option B: export quota

Option C: selective quota

Option D: global quota

Correct Answer: selective quota ✔

Option A: average total cost

Option B: average variable cost

Option C: average fixed cost

Option D: marginal cost

Correct Answer: average total cost ✔

Option A: predatory dumping

Option B: sporadic dumping

Option C: persistent dumping

Option D: yearend dumping

Correct Answer: predatory dumping ✔

Option A: domestic subsidy

Option B: voluntary restraint agreement

Option C: domestic content requirement

Option D: tariff-rate quota

Correct Answer: domestic content requirement ✔

Option A: does not require government taxes to finance it

Option B: yields the same deadweight welfare loss as an import tariff or import quota

Option C: has only a consumption effect deadweight loss

Option D: has only a protective effect deadweight loss

Correct Answer: has only a protective effect deadweight loss ✔

Option A: selling goods to foreigners at a price below that charged domestic consumers

Option B: selling goods to foreigners at a price below the cost of production

Option C: antidumping duties being levied on the imported, dumped goods

Option D: All of the above

Correct Answer: All of the above ✔

Option A: never

Option B: seldom

Option C: often

Option D: always

Correct Answer: seldom ✔

Option A: quota license

Option B: quota rents

Option C: quota prices

Option D: None of the above

Correct Answer: quota rents ✔

Option A: higher prices and reduced imports

Option B: increased government revenue

Option C: increased consumer surplus

Option D: decrease producer surplus

Correct Answer: higher prices and reduced imports ✔

Option A: prices

Option B: quantity

Option C: revenue

Option D: costs

Correct Answer: quantity ✔

Option A: U.S oil companies and workers deserved higher incomes

Option B: U.S oil was of superior quality and merited higher prices

Option C: one should not be too dependent on foreign suppliers of crucial resources

Option D: The U.S government needed the quota revenue to balance its budget

Correct Answer: one should not be too dependent on foreign suppliers of crucial resources ✔

Option A: Capture the entire subsidy in the form of higher profits

Option B: Increase their level of production

Option C: reduce wages paid to domestic workers

Option D: consider the subsidy as a increase in production cost

Correct Answer: Increase their level of production ✔

Option A: is a limit on the number of tariffs that a country can place on imports?

Option B: uses a single tariff along with import quotas to restrict import

Option C: is designed to avoid the the price increases caused by simple tariffs

Option D: is a two-tier tariff system intended to restrict imports?

Correct Answer: is a two-tier tariff system intended to restrict imports? ✔

Option A: domestic subsidy

Option B: export subsidy

Option C: import quota

Option D: export quota

Correct Answer: import quota ✔

Option A: lower the welfare of all Pakistanis

Option B: lead to increases in Pakistani consumer surplus

Option C: encourage Pakistan’s production of competing goods

Option D: encourage Pakistani workers to demand higher wages

Correct Answer: lead to increases in Pakistani consumer surplus ✔

Option A: 20 calculators increase

Option B: 25 calculators decrease

Option C: 25 calculators increase

Option D: 30 calculators increase

Correct Answer: 30 calculators increase ✔

Option A: more elastic in Japan, more substitutes are available from other nations

Option B: more elastic in Japan, fewer substitutes are available from other; nations

Option C: more inelastic in Japan; more substitutes are available from other; nations

Option D: more inelastic in Japan; fewer substitutes are available from other nations

Correct Answer: more elastic in Japan, more substitutes are available from other nations ✔

Option A: help more than they hurt

Option B: hurt more then they help

Option C: are equivalent to an import quota

Option D: are equivalent to an export quota

Correct Answer: help more than they hurt ✔

Option A: 1,600 computers, decrease, increase

Option B: 1,600 computers, increase, decrease

Option C: 1,200 computers, decrease, increase

Option D: 1,200 computers, increase, decrease

Correct Answer: 1,600 computers, increase, decrease ✔

Option A: $160,000

Option B: $420,000

Option C: $540,000

Option D: $660,000

Correct Answer: $660,000 ✔

Option A: an import tariffs

Option B: a tariff rate quota

Option C: a selective quota

Option D: a global quota

Correct Answer: a global quota ✔

Option A: The within-quota tariff rate exceeds the over-quota tariff rate

Option B: the over-quota tariff rate exceeds the with-quota tariff rate

Option C: The within-quota tariff rate equals the over-quota tariff rate

Option D: The within-quota tariff rate plus over-quota tariff rate equal 100 percent

Correct Answer: the over-quota tariff rate exceeds the with-quota tariff rate ✔

Option A: 200, $2,000, 100 $1,000

Option B: 300, $1,800, 800 $800

Option C: 300, $1,800, 400 $800

Option D: 500, $1,400, 400 $800

Correct Answer: 500, $1,400, 400 $800 ✔

Option A: result in government purchase policies favoring domestic over foreign producers

Option B: result in government purchase policies favoring foreign over domestic producers

Option C: attempt to restrict the number of tourists leaving a nation

Option D: are intended to publicize the advantage of the most efficient domestic companies

Correct Answer: result in government purchase policies favoring domestic over foreign producers ✔

Option A: export quotas imposed by the Japanese government

Option B: export tariffs imposed by the Japanese’s government

Option C: import quotas imposed by the U.S government

Option D: domestic subsidies granted by the U.S government

Correct Answer: export quotas imposed by the Japanese government ✔

Option A: sporadic dumping

Option B: predatory dumping

Option C: persistent dumping

Option D: foreign dumping

Correct Answer: sporadic dumping ✔

Option A: Predatory dumping

Option B: sporadic dumping

Option C: persistent dumping

Option D: year end dumping

Correct Answer: sporadic dumping ✔

Option A: two tier tariff applied to a country’s imports

Option B: three-tier tariff applied to a country’s imports

Option C: two tier quota applied to a county’s exports

Option D: three tier quota applied to a country’s exports

Correct Answer: A. two tier tariff applied to a country’s imports ✔

Option A: domestic content laws

Option B: government procurement policies

Option C: health, safety, and environmental standards

Option D: antidumping/countervailing duties applied to imports

Correct Answer: antidumping/countervailing duties applied to imports ✔

Option A: export quota

Option B: embargo

Option C: auction quota

Option D: tariff quota

Correct Answer: export quota ✔

Option A: quota licenses are given to foreign exporting companies

Option B: quota licenses are auctioned to the highest bidding importing company

Option C: if quota licenses are given to domestic consumers of the good

Option D: Both A and C

Correct Answer: quota licenses are auctioned to the highest bidding importing company ✔

Option A: who has the quota license

Option B: the size of the quota

Option C: elasticities of domestic demand and supply

Option D: All of the above

Correct Answer: All of the above ✔

Option A: embargoes

Option B: voluntary export restraints

Option C: nontariff barriers

Option D: orderly marketing agreements

Correct Answer: embargoes ✔

Option A: Orderly marketing

Option B: trigger pricing

Option C: domestic content pricing

Option D: dumping

Correct Answer: dumping ✔

Option A: always

Option B: often

Option C: seldom

Option D: never

Correct Answer: seldom ✔

Option A: Koreans are selling DVDs in the U.S below their production cost

Option B: Koreans are selling DVDs is the U.s above their productions cost

Option C: The cost of manufacturing DVDs in Korea is lower in Korea than in the U.S since wages are lower in Korea

Option D: The cost of manufacturing DVDs in Korea is higher in Korea than in the U.S since wages are higher in Korea

Correct Answer: Koreans are selling DVDs in the U.S below their production cost ✔

Option A: domestic producers of the imported good being harmed

Option B: domestic consumers of the imported good being harmed

Option C: Prices increasing in the importing country

Option D: Prices falling in the exporting country

Correct Answer: domestic producers of the imported good being harmed ✔

Option A: foreign corporations

Option B: foreign workers

Option C: domestic corporations

Option D: The domestic government

Correct Answer: The domestic government ✔

Option A: 20 calculator, $50

Option B: 20 calculator, $100

Option C: 25 calculator, $50

Option D: 25 calculator, $100

Correct Answer: 20 calculator, $50 ✔

Option A: $65 and 40 calculators

Option B: $55 and 20 calculators

Option C: $45 and 25 calculators

Option D: $30 and 40 calculators

Correct Answer: $45 and 25 calculators ✔

Option A: is less restrictive on a country’s imports than a tariff

Option B: Is more restrictive on a country’s imports than a tariff

Option C: has the same restrictive effect on a country’s imports as a tariff

Option D: will always generate increased tax revenue for the government

Correct Answer: B. Is more restrictive on a country’s imports than a tariff ✔

Option A: increase, increase

Option B: increase, decrease

Option C: decrease, increase

Option D: decrease, decrease

Correct Answer: decrease, increase ✔

Option A: $1,500 and 2,800 computers

Option B: $2,000 and 1,600 computers

Option C: $2,500 and 2,000 computers

Option D: $3,500 and 2,000 computers

Correct Answer: $2,500 and 2,000 computers ✔

Option A: offset the margin of dumping

Option B: punish domestic consumers for buying high-priced imported goods

Option C: discourage foreign governments from subsidizing their exporters

Option D: reduce the tariff revenue of the domestic government

Correct Answer: offset the margin of dumping ✔

Option A: The quota results in efficiency reductions but the tariff does not

Option B: The tariff results in efficiency reductions but the quota does not

Option C: They have identical impact on how much is produced and consumed

Option D: They have identical impact on how income is distributed

Correct Answer: They have identical impact on how much is produced and consumed ✔

Option A: the quota results in efficiency reductions but the tariff does not

Option B: The tariff results in efficiency reductions but the quota does not

Option C: They have different impacts on how much is produced and consumed

Option D: They have different impacts on how income is distributed

Correct Answer: They have different impacts on how income is distributed ✔