Suppose an Industry Receives Protection from the Government in the Form

question 119

Multiple Choice

Suppose an industry receives protection from the government in the form of tariffs. A number of years later, it is observed that the quantity supplied by domestic firms had decreased and that the domestic price was substantially greater than the world price. We could conclude that

• A) the tariff had been imposed to counteract dumping and had been successful.
• B) removal of the tariff would actually cause domestic output to increase and price to fall.
• C) the tariff had been imposed to protect an infant industry and that the industry still needed protection.
• D) removal of the tariff would cause domestic output to fall even further and the price to fall to consumers.

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Definitions:

Organic Product

A compound derived from living organisms or synthesized to mimic such compounds, typically containing carbon atoms in its structure.

Major Organic

Refers to the most significant or prevalent organic compound produced in a given chemical reaction.

Reaction

A process in which substances interact, typically involving bond formation or breakage, resulting in the transformation into different substances.

Ethylene Oxide

A highly reactive, flammable gas used primarily to produce ethylene glycol and as a sterilant for medical equipment and supplies.