In 2007, European Union (EU) Negotiators Offered to Cut Tariffs

question 50

Multiple Choice

In 2007, European Union (EU) negotiators offered to cut tariffs for Latin American bananas to avoid "banana wars." What are the effects of a cut in tariffs?

• A) Europe will start to export bananas.
• B) The price of bananas for consumers will increase.
• C) The quantity of bananas imported into the EU will increase.
• D) The quantity of bananas produced in the EU (such as in France and Spain) will increase.

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Definitions:

Total Liabilities

The sum of all financial obligations a company owes to outside parties, including loans, accounts payable, and mortgage obligations.

State Sales Tax

A tax imposed by a state on the sale of goods and services, typically calculated as a percentage of the sales price.

Revenue Report

A financial document that outlines the income generated by a company from its normal business operations.

General Journal Entry

A record in the general journal that includes the date, accounts and amounts to be debited and credited, and a brief description of the transaction.