Suppose That the Nominal Tariff Rate on Final Good X

question 17

Multiple Choice

Suppose that the nominal tariff rate on final good X is 7 percent and that the weighted average of the nominal tariff rates on the inputs used in producing good X is 10 percent. In this situation, the effective rate of protection (ERP) for final good industry X

• A) will be greater than 10 percent.
• B) will be less than 10 percent but must be greater than 7 percent.
• C) will be less than 7 percent but must be greater than 0 percent.
• D) can be negative.

---

Definitions:

Innate Immunity

Immune system response that is the same with each exposure to an antigen; there is no ability for the system to remember a previous exposure to the antigen.

Immune Response

The body's defense mechanism against foreign substances or pathogens through the activation of immune cells.

Thymus Gland

An organ located in the chest, which plays a vital role in the development and maturation of T-cells, essential for the immune response.

Reticular Fibers

Fine, branching fibers forming networks in various tissues and supporting cells in organs like the spleen and lymph nodes.