The Figures Given Below Illustrate a Situation of a Trade

question 29

Multiple Choice

The figures given below illustrate a situation of a trade embargo. In Figure (a) D_d and S_d are the domestic demand and supply curves of the embargoing countries. The import price is P₀ and the target country imports the amount Q₀ before the embargo is imposed. The embargo initiator(s) lose area _____ while the target country loses _____.

• A)(b + c); (a + c)
• B)(a + d); (b + c)
• C)a; b
• D)a; (b + c)

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Definitions:

Child and Dependent

Terms used in tax law to refer to individuals for whom the taxpayer provides more than half of financial support, qualifying the taxpayer for certain deductions.

Care Expense Credit

A tax credit available for expenses incurred in caring for a qualifying individual to allow the taxpayer to work or look for work.

AGI

Adjusted Gross Income, which is gross income minus adjustments; a key measure used to determine tax liabilities and eligibility for credits.

EIC

Earned Income Credit; a refundable tax credit in the U.S. for low to moderate-income working individuals and families, particularly those with children.