A US Tariff Imposed on Items That Can Be Produced More

question 135

Multiple Choice

A U.S. tariff imposed on items that can be produced more cheaply abroad

• A) benefits Americans by making these goods cheaper.
• B) makes the goods more expensive in foreign markets.
• C) creates a deadweight loss.
• D) makes the world market more efficient.

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Definitions:

Retained Earnings

Profits that a company keeps after dividends have been paid out to shareholders, used for reinvestment in the business or to pay down debt.

Capital

Resources made and used by people to produce and distribute goods and services; includes tools, machinery, and buildings.

Interest Rates

Charges applied on borrowed money or earned through deposits, varying according to the type, term, and risk associated with the financial product.

Present Value

The present value of a future sum of money or series of cash flows, discounted at a certain rate of return.