Suppose the Government of an Importing Country Is Considering Imposing

question 72

Multiple Choice

Suppose the government of an importing country is considering imposing either a tariff that would result in imports falling to 1 million units per year or an import quota of 1 million units per year.Which of the following would be true in such a case?

• A)The U.S.consumers would lose more consumer surplus in the case of tariffs than quotas.
• B)The U.S.producers would gain more in the case of quotas than tariffs.
• C)The change in quantity demanded would be greater in the case of tariffs than quotas.
• D)The tariff revenue would go to U.S.government;quota benefits may go to foreign producers.
• E)The U.S.export market would shrink more in the case of quotas than tariffs.

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Definitions:

Biodiversity

The variety of living organisms considered at three levels: genetic diversity, species diversity, and ecosystem diversity. Also called biological diversity.

Logging Companies

Businesses involved in the cutting down, processing, and selling of trees for timber or pulp.

Biodiversity Hotspot

Biogeographic region that is a significant reservoir of endemic biodiversity and is threatened with continued habitat destruction.

Endemic Species

Localized, native species that are not found anywhere else in the world. Compare with cosmopolitan species.