A compound tariff is a combination of a(n)
A) tariff quota and a two-tier tariff.
B) revenue tariff and a protective tariff.
C) import tariff and an export tariff.
D) specific tariff and an ad valorem tariff.

Question

Quizplus · Accepted Answer

A compound tariff is a combination of a specific tariff (a fixed charge per unit) and an ad valorem tariff (a percentage of the product's value). In this case, the tariff on the imported automobiles is a 20% ad valorem tariff, and the U.S. components used in these vehicles have a value of $10,000, which could be subject to a specific tariff. Therefore, a compound tariff could be applied with both an ad valorem tariff and a specific tariff.

A Compound Tariff Is a Combination of A(n)