Suppose That India Changes the Tariff on All Imports from 40

question 5

Multiple Choice

Suppose that India changes the tariff on all imports from 40% to 10%. What is the desired effect of this change?

• A) to increase the price and amount of imports
• B) to decrease the price and amount of imports
• C) to increase the price of imports and decrease the amount of imports
• D) to decrease the price of imports and increase the amount of imports

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Definitions:

Common Stock

A type of security that represents ownership in a corporation, giving holders a share of the profits in the form of dividends.

Revenues

Income that a company receives from its normal business activities, typically from the sale of goods and services to customers.

Financing

The means by which companies or governments raise funds for their activities, by issuing debt, equity, or other financial instruments.

Net Income

A company's profit margin following the removal of all operational costs and taxes from its revenue.