Which of the Following Would Be the Most Likely Long-Run

question 29

Multiple Choice

Which of the following would be the most likely long-run effect if the United States increased its tariff rates and adopted stricter import quotas?

• A) a decrease in both U.S. imports and exports
• B) an increase in both U.S. imports and exports
• C) a decrease in U.S. imports and an increase in U.S. exports
• D) an increase in U.S. imports and a decrease in U.S. exports

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Definitions:

LIFO Inventory Cost Method

An inventory valuation method that assumes the last items purchased are the first ones sold, affecting the company's bookkeeping and tax calculations.

Current Revenues

Income received by an entity within its normal business operations and within the current accounting period.

Lower-Of-Cost-Or-Market

An accounting principle that values inventory at the lesser of its historical cost or the market replacement cost, ensuring inventory is not overstated.

Inventory Valuation

The method used to calculate the cost associated with an inventory, which can impact the cost of goods sold and net income.