Podcast
Questions and Answers
What is one of the main reasons for imposing high tariffs on imports?
What is one of the main reasons for imposing high tariffs on imports?
Specific tariffs vary depending on the value of the imported goods.
Specific tariffs vary depending on the value of the imported goods.
False
What are the two main groups that gain when a small country imposes a tariff?
What are the two main groups that gain when a small country imposes a tariff?
Domestic producers and government
The mercantilistic argument for tariffs is known as the ______ argument.
The mercantilistic argument for tariffs is known as the ______ argument.
Signup and view all the answers
Match the following terms related to tariffs with their definitions:
Match the following terms related to tariffs with their definitions:
Signup and view all the answers
Which statement is true regarding the terms-of-trade argument for tariffs?
Which statement is true regarding the terms-of-trade argument for tariffs?
Signup and view all the answers
Tariff revenues contribute significantly to the government budget.
Tariff revenues contribute significantly to the government budget.
Signup and view all the answers
Name one effect of imposing import tariffs.
Name one effect of imposing import tariffs.
Signup and view all the answers
When a country introduces tariffs, ______________________ will lose.
When a country introduces tariffs, ______________________ will lose.
Signup and view all the answers
Identify a key difference between the 'small country' and 'large country' models regarding tariffs.
Identify a key difference between the 'small country' and 'large country' models regarding tariffs.
Signup and view all the answers
What is the primary goal of a passive foreign trade policy?
What is the primary goal of a passive foreign trade policy?
Signup and view all the answers
A protective tariff serves to generate significant government income.
A protective tariff serves to generate significant government income.
Signup and view all the answers
What type of tariff can BiH introduce if foreign exporters sell products at lower prices in their own market compared to BiH's market?
What type of tariff can BiH introduce if foreign exporters sell products at lower prices in their own market compared to BiH's market?
Signup and view all the answers
The type of tariff imposed to block imports completely is called a ______.
The type of tariff imposed to block imports completely is called a ______.
Signup and view all the answers
What was the purpose of high tariff rates on car imports in many Latin American countries during the 1970s?
What was the purpose of high tariff rates on car imports in many Latin American countries during the 1970s?
Signup and view all the answers
BiH can introduce a specific tariff to protect its domestic production from foreign competition.
BiH can introduce a specific tariff to protect its domestic production from foreign competition.
Signup and view all the answers
What situation might lead BiH to impose a prohibitive tariff?
What situation might lead BiH to impose a prohibitive tariff?
Signup and view all the answers
Match the type of tariff to its purpose:
Match the type of tariff to its purpose:
Signup and view all the answers
Study Notes
Passive Foreign Trade Policy
- Aims to regulate trade without government intervention, letting market forces determine trade flows.
Protective Tariffs in Latin America (1970s)
- High tariffs on imported cars despite no domestic car industry.
- Intended to protect nonexistent domestic industries and encourage import substitution.
Antidumping Tariffs (BiH)
- Implemented when exporters sell products cheaper abroad than domestically.
- Used as a countermeasure against large import volumes affecting domestic production..
Prohibitive Tariffs (BiH)
- Used when a country lacks foreign currency to pay for imports.
- Implemented to curb imports of luxury goods.
Specific Import Tariffs
- A fixed amount per unit irrespective of the value of the imported goods.
Effects of Import Tariffs
- Increased prices for consumers.
- Increased government revenue .
- Protected domestic producers.
- Reduced overall trade volume
Small Country vs. Large Country Tariffs
- Small countries cannot significantly affect foreign prices.
- Large countries can influence foreign prices
Mercantilist Argument for Tariffs
- Focuses on accumulating domestic wealth by limiting imports.
Terms-of-Trade Argument for Tariffs
- Only valid for large countries able to affect foreign prices.
Studying That Suits You
Use AI to generate personalized quizzes and flashcards to suit your learning preferences.
Description
This quiz explores various tariff policies, including protective and antidumping tariffs, and their impacts on trade in Latin America and Bosnia and Herzegovina. Understand the influence of market forces and government interventions in shaping trade dynamics.
