Governments choose to use voluntary export restraints (VERS) rather than tariffs because voluntary export restraints do not generate any welfare loss in the importing country. the increase in the price of the imported good in the domestic market is lower in the case of a VER than a tariff. voluntary export restraints have the potential to generate higher revenue. tariffs more obviously violate the international rules of the World Trade Organization (WTO).

Governments choose to use voluntary export restraints (VERS) rather than tariffs because voluntary export restraints do not generate any welfare loss in the importing country. the increase in the price of the imported good in the domestic market is lower in the case of a VER than a tariff. voluntary export restraints have the potential to generate higher revenue. tariffs more obviously violate the international rules of the World Trade Organization (WTO).

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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The analysis of a quota implies that .... please select one or more : a) The effect of a quota on trade is the same as a tariff. b) A quota will cause the same deadweight losses as a tariff. c) States should prefer quota instead of tariff. d) A quota increases imports if it is associated with high price elasticity of demand. e) When a quota is applied, the consumer surplus decreases but the producer surplus does not increase because only the state benefits from the quota.
Domestic demand for fidget spinners in the domestic economy is characterized by the equation P=100−2Q, domestic supply is characterized by the equation Q=P−10, and the world price is equal to 60. Then the export subsidy of 10 per unit will a) increase domestic exports by 15 b) change nothing b) lead to a decrease in the world price by 10 c) increase domestic exports by 10
Domestic demand for fidget spinners in the domestic economy is characterized by the equation P = 100 – 2Q, domestic supply is characterized by the equation Q = P10, and the world price is equal to 60. Then the export subsidy of 10 per unit will lead to a decrease in the world price by 10 increase domestic exports by 10 increase domestic exports by 15 change nothing
For many purposes, the use of a tariff is said by economists to be “second best.” This means that Group of answer choices Another policy exists that would accomplish the same purpose as the tariff at lower economic cost. The tariff does not help those with the highest incomes, but only those with the second highest. The tariff benefits the country only by making other countries worse off. The tariff cannot be beneficial for the country as a whole.
A small country can import a good at a world price of 10 per unit. The domestic supply curve of the good is Q = 50+ 5P. The demand curve is Qd = 400-10P. Suppose for political reasons the government counts a dollar's worth of gain to producers as being worth $2 of either consumer gain or government revenue. Assume the government's objective is to maximize national welfare. The change in the government's objective of a tariff of $5 per unit is $. (Round your answer to the nearest penny.)
can you reword this paragraph? Voluntary export restraint (VER) is really a restriction upon on quantity of goods which an exporting nation can export to another country. VER is self-imposed on the exporting country. As for Ghana, this country is importing food, which is an agriculturally inclined country. This means that there is something lacking with the agriculture sector if Ghana is not even able to meet the needs of its citizens’ demand. Voluntary export restraint (VER) is a type of non-tariff barriers to trade. It could be the outcome of requests made by the importing country to provide a measure of protection for its domestic businesses producing competing goods. And this is what the government of Ghana has done. VER also would temporarily increase jobs for domestic workers in the agricultural sector. Protection from VER encourages domestic producers to recruit locally. Security from foreign exchange decreases productivity in the long run. Without competition, it is not…
Import quotas and import tariffs have qualitatively similar effects on equilibrium outcomes in competitive markets. True False
Analyze with the help of a graph how an export subsidy affects the terms of trade of the country providing the subsidy. Is the export subsidy desirable from the perspective of overall social welfare of the country? Explain.
Which of the choices describes how the effects of import tariffs and import quotas are different? The domestic cost of an import tariff is larger than the domestic cost of a comparable import quota. Import tariffs create deadweight loss, whereas import quotas do not create deadweight loss. Quotas do not affect the equilibrium price, whereas tariffs do not affect the equilibrium quantity. Some foreign producers receive some of the benefits generated by an import quota.
The domestic demand and supply for sugar are, respectively, Qd = 60,000 − 400P and QSD = 20,000 + 500P. The foreign supply is QSF = 20,000 + 100P. Suppose an import quota of 13,000 is imposed in the domestic market. What will be the new market price of sugar? Multiple Choice $15 $45 $30 $20
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