What Is the Effect of an Export Tariff in a Large

question 75

Multiple Choice

What is the effect of an export tariff in a large country on
The importing country?

• A)The importing country loses, since it pays a higher price for the product.
• B)The importing country gains, since it pays a lower price for the product.
• C)The importing country neither gains nor loses, since the world price does not change.
• D)The importing country will gain from the terms of trade effect.

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Definitions:

Annual Interest Rate

The percentage of interest that is charged or earned on an investment or loan over the course of a year.

Revolving Line

A credit arrangement that allows a borrower to use or withdraw funds up to a designated limit, repay them, and borrow again.

Simple Interest

A method of calculating interest where the interest charge is based only on the original principal, not on the interest which has been added over time.

Annual Rate

The interest rate for a period of one year.