1. Suppose the tariff rate on computers is 20% and tariff rates on the inputs used in producing computers is 30%. Thus, the effective rate of protection for computers must

a. be less than 20 percent, and can be negative

b. be less than 20 percent, but must be greater than zero

c. equal 10 percent

d. exceed 30 percent

1. Nontariff trade barriers could include all of the following except

a. domestic content laws

b. government procurement policies

c. health, safety, and environmental standards

d. antidumping/countervailing duties applied to imports

Answer the next 5 questions based upon the following diagram for a country, assumed to be too small to influence prices in the world market for sweaters. In the diagram, Sw is the world price of sweaters, and Sw +t the price of sweaters with a tariff