The Basic Difference in the Economic Effects of a Tariff

question 17

Multiple Choice

The basic difference in the economic effects of a tariff compared with a quota is that a:

• A)quota generates revenue for the government.
• B)tariff generates revenue for the government.
• C)tariff raises product prices, but a quota does not raise product prices.
• D)quota raises product prices, but a tariff does not raise product prices.

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Definitions:

Long-Term Trading Investments

Investments in stocks, bonds, or other securities that a company intends to hold for a period longer than a year to achieve long-term financial goals.

Strategic Investments

Investments made to gain a competitive advantage or achieve long-term goals rather than for short-term profit.

Trading Investments

Trading investments are financial assets acquired with the intention of selling them for a short-term gain, often held by companies in financial sectors.

Statement Of Financial Position

A financial report that displays a company's assets, liabilities, and equity at a specific point in time.