Suppose an importer of steel is required to pay a tariff of $20 per ton plus 5 percent of the value of steel.This is an example of
A) a specific tariff.
B) an ad valorem tariff.
C) a compound tariff.
D) a tariff quota.

Question

Quizplus · Accepted Answer

A compound tariff is a combination of a specific tariff (a fixed fee per unit, in this case, $20 per ton) and an ad valorem tariff (a percentage of the value, in this case, 5 percent). This example includes both components, making it a compound tariff.

Suppose an Importer of Steel Is Required to Pay a Tariff