In a Small Country, an Export Tariff Will Cause A(n)

question 94

Multiple Choice

In a small country, an export tariff will cause a(n) _______ in the domestic price of the export and _______ in the world price of the export.

• A) increase; a decrease
• B) decrease; a decrease
• C) decrease; no change
• D) increase; no change

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Definitions:

Budget Constraint

A financial limit that represents the combination of goods and services a consumer can purchase with their available income.

Consumer's Income

The total amount of income earned by an individual or household from various sources, influencing their purchasing power and demand for goods and services.

Price of a Book

The amount of money charged for a book, determined by factors like publishing costs, author royalties, and market demands.

Budget Constraint

A restriction on the possible combinations of goods and services an individual can afford to buy given their income and the prices of the goods.