The Effective Rate of Protection Measures

question 35

Multiple Choice

The effective rate of protection measures

• A) the "true" ad valorem value of a tariff.
• B) the quota equivalent value of a tariff.
• C) the efficiency with which the tariff is collected at the customhouse.
• D) the protection given by the tariff to domestic value added.
• E) the difference between domestic and foreign prices of the import.

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Definitions:

Income Increased

A scenario where an individual's or entity's earnings rise, affecting their purchasing power and economic well-being.

Income Elasticity

A measure of how the demand for a good or service changes relative to a change in consumers' income.

Normal Good

A good for which demand increases as the income of consumers increases and decreases as the income of consumers decreases.

Inferior

A term used in economics to describe goods whose demand decreases as the income of the consumer increases, contrasted with normal goods.