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Suppose Canada Imposes a 20% Tariff on Imported Textiles

question 77

Multiple Choice

Suppose Canada imposes a 20% tariff on imported textiles.Which of the following will occur?
1) an increase in producer surplus for Canadian textile producers
2) a reduction in the quantity of textiles imported
3) a reduction in the consumption of textiles in Canada


Definitions:

Promised Yield

The return a bond issuer commits to pay to bondholders, usually expressed as an annual percentage.

Modified Duration

A measure of the sensitivity of a bond's price to changes in interest rates, indicating the percentage change in price for a one percent change in yield.

Yield To Maturity

The total return anticipated on a bond if it is held until its maturity date.

Semiannually

A term indicating that an event or action occurs twice a year.

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