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Suppose That the World Price of Automobiles Is $20,000 and Automobile

question 45

Essay

Suppose that the world price of automobiles is $20,000 and automobile manufacturers in country A use $10,000 worth of imported inputs and no domestic inputs. What is the effective rate of protection for the automobile industry in country A, if there is a tariff of 25 percent on imported automobiles and a tariff of 50 percent on imported inputs used in this industry?


Definitions:

Audio Books

Recorded readings of books, which can be listened to on various devices, offering an alternative to traditional reading.

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Lighting designed to minimize harsh reflections and brightness, often used to create environments comfortable for the eyes.

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A condition characterized by a severe lack of moisture in the outer layer of the skin, resulting in flakiness, itching, and sometimes cracking.

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Refers to how often an individual takes baths or showers, a practice that varies culturally and personally for hygiene and comfort.

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