A Tariff Can Best Be Described as

question 12

Multiple Choice

A tariff can best be described as

• A) an excise tax on an imported good.
• B) a government payment to domestic producers to enable them to sell competitively in world markets.
• C) an excise tax on an exported good.
• D) a law that sets a limit on the amount of a good that can be imported.

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Definitions:

President

The head of state and/or head of government in a republic, typically elected to be the chief executive officer and hold the highest office in the land.

Multiplier

An economic factor that quantifies the additional economic activity generated from an initial injection of spending.

Equilibrium Real GDP

is the level of Gross Domestic Product where aggregate demand equals aggregate supply, resulting in a stable economy without inflationary or recessionary gaps.

Investment

The act of allocating resources, usually financial, with the expectation of generating an income or profit, such as purchasing stocks, bonds, or real estate.