When a Country That Imports a Particular Good Imposes a Tariff

question 48

Multiple Choice

When a country that imports a particular good imposes a tariff on that good,

• A)consumer surplus increases and total surplus increases in the market for that good.
• B)consumer surplus increases and total surplus decreases in the market for that good.
• C)consumer surplus decreases and total surplus increases in the market for that good.
• D)consumer surplus decreases and total surplus decreases in the market for that good.

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Definitions:

Percentage Change

Percentage Change is a mathematical calculation that shows how much a quantity has increased or decreased as a percentage of its previous amount.

Incomes

Periodic earnings obtained from professional activities or financial investments.

Services

Economic activities that produce intangible goods, such as entertainment, healthcare, and education.

MPC

A measure of the rate at which consumers are likely to spend additional income, rather than save it.