Refer to the Above Diagram, Where S_d and D_d Are

question 5

Multiple Choice

Refer to the above diagram, where S_d and D_d are the domestic supply and demand for a product and P_c is the world price of that product.S_d + Q is the product supply curve after an import quota is imposed.A tariff of P_cP_t will:

• A)lower domestic price and increase domestic consumption.
• B)increase the revenues of domestic producers by areas E + F + K.
• C)increase the revenues of domestic producers by areas G + H.
• D)increase the revenues of domestic producers by areas E + F + G + H + J.

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Definitions:

Par Value

A nominal face value assigned to shares of stock by the issuing company, which often bears no relation to the market value.

Common Stock

Common stock represents shares of ownership in a corporation, giving holders voting rights and a share in the company’s profits through dividends.

Serial Bonds

Bonds of a single issue that mature in installments at regular intervals.