A Tariff Makes the Total Economy

question 79

Multiple Choice

A tariff makes the total economy

• A) better off because it increases the domestic production of the good.
• B) better off because it decreases the deadweight loss from international trade.
• C) worse off because it creates a deadweight loss.
• D) worse off because it creates revenue for the government.
• E) worse off because it decreases both domestic consumer surplus and domestic producer surplus.

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Definitions:

Time Period

A specific duration or interval of time, which may refer to seconds, hours, days, months, or even years, during which certain events or measurements are considered or observed.

IRS

Stands for Internal Revenue Service, the federal agency responsible for administering tax laws in the United States.

Tax Advantage

Financial benefits that apply to certain investments or accounts that are favored by tax policy.

Sole Proprietorships

A business owned and operated by a single individual, with no legal distinction between the owner and the business entity.