When a Tariff on Imported Inputs Exceeds That on the Finished

question 13

Multiple Choice

When a tariff on imported inputs exceeds that on the finished good,

• A) The nominal tariff rate on the finished product would tend to overstate its protective effect
• B) The nominal tariff rate would tend to understate it's protective effect
• C) It is impossible to determine the protective effect of a tariff
• D) Tariff escalation occurs

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