Microeconomics (2nd Edition) (Pearson Series in Economics)
2nd Edition
ISBN: 9780134492049
Author: Daron Acemoglu, David Laibson, John List
Publisher: PEARSON
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Chapter 8, Problem 12Q
To determine
Problem associated with tariffs.
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Ghana's parliament is debating how to undertake ISI. The debate centres on whether they should impose tariffs on imports or use quotas. Which system is better for consumers? (use a diagram to explain yourself).
Ghana's parliament is debating how to undertake ISI. The debate centres on whether they should impose tariffs on imports or use quotas. Which system is better for consumers?
In the picture below is the full question. The highlighted one is my guess which is wrong.
Which of the following best explains how subsidies work as a trade restriction?
A)They increase competition for a new business, forcing it to be more productive, and lowering prices for consumers.
B)They limit the import of foreign goods and create shortages.
C)They place a tax on foreign goods, making foreign good expensive, increasing demand for domestic goods(this one is wrong)
D)Governments pay producers, offsetting costs, increasing supply, lowering prices, and reducing foreign competition.
Chapter 8 Solutions
Microeconomics (2nd Edition) (Pearson Series in Economics)
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