Economic Analysis of Social Issues 1st Edition by Alan Grant

Exercise 6

In problem, the loss that is associated with fewer transactions occurring because of the tariff is called the _________.
A) Sunk cost of the tariff
B) Quota rent
C) Export opportunity cost
D) Deadweight loss
Problem :
In 2002, steel industry lobbyists and auto industry lob byists pressured then-President George Bush and Congress for the highest possible tariffs on imported steel. In response, President Bush and Congress imposed stiff tariffs on steel. This type of behavior, in which individuals, industry lobbyists, or other special interest groups attempt to influence law for their own economic advantage, is called _________.
A) Rent seeking
B) Deadweight loss
C) Quota renting
D) Export enhancement