[Lambswool Tax] the U

question 18

Multiple Choice

[Lambswool tax] The U.S. and Canada are members of the World Trade Organization and GATT. Frustrated by the tough competition from Canadian suppliers, Lambswool suppliers in the U.S. have pressured Congress to pass a law requiring importers to pay a tax per pound of lambswool imported to the U.S. and restricting the number of pounds of lambswool imported from specific countries, including Canada. Wholly Wool, Inc., is a Canadian company that sells lambswool that is nearly identical to lambswool produced and sold in the U.S.
-Wholly Wool's president claims the United States is in violation of GATT because of the improper restriction on the amount of lambswool that can be imported. Is he correct?

• A) Yes, because GATT prohibits all restrictions on importation of domestic animal products.
• B) Yes, because the quantitative restriction was made for national economic reasons.
• C) No, because GATT allows quantitative restrictions that have a rational basis.
• D) No, because the goods are also produced in the United States.
• E) No, because the U.S. is entitled to tax like goods.

Understand the role and responsibilities of the board of directors in a corporation.

Know the different strategic moves a corporation can make (e.g., mergers, acquisitions).

Comprehend the purpose and function of various defensive strategies against hostile takeovers.

Understand the basic concepts and significance of developmental theories in young adulthood, including Perry's theory of intellectual and ethical development.

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Definitions:

Adverse Selection

A situation in which one party in a transaction has more or better information than the other, often leading to a misallocation of resources.

Moral Hazard

A situation in economic theory where one party is willing to take more risks because the negative consequences of the risk will be borne by another party.

Moral Hazard

A situation where one party is more likely to take risks because another party bears the consequences of those risks.

Specific Purpose

A clearly defined and precise goal or objective that a project, action, or entity aims to achieve.