Refer to the Information Provided in Figure 20

question 196

Multiple Choice

Refer to the information provided in Figure 20.4 below to answer the question(s) that follow. Figure 20.4
-Refer to Figure 20.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. After the tariff is imposed, this country will import ________ leather wallets.

• A) 50
• B) 100
• C) 150
• D) 200

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Definitions:

Budget Surpluses

Occurs when a government's revenues exceed its expenditures during a fiscal period, leading to extra funds.

Budget Deficits

A financial situation where expenditures exceed revenue.

Federal Budget

An annual financial statement presenting the government's proposed revenues and spending for a fiscal year.

Crowds Out

Refers to the effect where increased government spending and borrowing reduce private investment in the markets.