The Difference Between a Specific Tariff and an Ad Valorem

question 172

Multiple Choice

The difference between a specific tariff and an ad valorem tariff is that a specific tariff

• A)is a set amount of money per unit of a product, while an ad valorem tariff is a set percentage of product price
• B)is a set percentage of product price, while an ad valorem tariff is a set amount of money per unit of a product
• C)names a particular good to which the tariff applies, while an ad valorem tariff applies to large classes of products
• D)applies only to imports, while an ad valorem tariff applies only to exports
• E)sets a strict quota limit on the amount one individual can purchase, while an ad valorem tariff sets no such limit

Understand the concept of cartels and their impact on profit maximization.

Identify the effects of tacit collusion among firms in an oligopoly.

Analyze the implications of the Cournot model on firm behavior and market outcomes.

Distinguish between different types of oligopoly models such as Cournot, price leadership, and collusion.

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Definitions:

Governing Unit

An organization or body that holds the authority to make decisions and regulations for a particular group or area.

Ethical Dimension

Refers to the moral aspects that arise in various contexts, guiding right or wrong behavior and practices.

Administrative Agencies

Governmental bodies with the authority to implement and enforce specific legislative acts through the creation of rules, regulations, and procedures.

Written Laws

Legal rules and regulations that are formally documented and established by legislative bodies.