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Question 4 6 pts Notes: - Provide your answers as a whole number {e.g.. 60 and NOT 60.0, 60%, 0.60. or $60]. Incorrectly submitted answers
Question 4 6 pts Notes: - Provide your answers as a whole number {e.g.. 60 and NOT 60.0, 60%, 0.60. or $60]. Incorrectly submitted answers will be counted incorrect. Suppose a good is produced in a country from a combination of foreign parts and domestic inputs. If the good sells for $9130 but requires $400 of imported parts. The domestic value added is $l 500 l. Assuming the country cannot change the world price, a 10% tariff on the nal good will cause the domestic price to rise to $l 99\" l and cause the domestic value added to become $l 595' l . In this case, the effective rate of protection is 18 l %_ If, in addition to the 10% tariff on the nal good, a 10% tariff on imported parts is levied. the effective rate of protection for domestic manufacturers becomes 1'3 9'6
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