Question 1

When the United States levies a tax on textiles from India, this tax is a type of

Accepted Answer

A tax on imports is known as a tariff.

Question 2

____ is the exportation of large quantities of a product at a price lower than that of the same product in the home market.

Accepted Answer

Dumping is when a company exports goods to another country at a lower price than that charged for the same goods in its home market. The motive for dumping may be to gain market share in the importing country or to dispose of excess inventory. Dumping is generally considered unfair competition and is often subject to anti-dumping measures.

Question 3

American automakers are concerned about the availability of so many foreign cars to U.S. consumers, and that their chances to sell their own cars are limited. To directly correct the situation, they encourage Congress to impose a(n)

Accepted Answer

An import quota is a restriction placed on the amount of a particular good that can be imported into a country. By implementing an import quota on foreign cars, American automakers would have less competition in the market and a better chance to sell their own cars. Options A, B, D, and E all involve restrictions or taxes on exports, which would not necessarily benefit American automakers.

Question 4

Taiwanese manufacturers are dumping toys in Germany. What will happen to German toy manufacturers if the German government allows this dumping to continue?

Accepted Answer

If German manufacturers cannot compete with the prices of the Taiwanese imports, they will lose market share and may even go out of business. This would have a negative impact on the German toy industry and potentially result in job losses. Options A, B, D, and E are not likely outcomes if German manufacturers cannot compete with the prices of the imported toys.

Question 5

The U.S. government imposes a tax on imported automobiles from Japan, Korea, Germany, and other foreign nations to increase government funds. This is best described as a(n)

Accepted Answer

A revenue tariff is imposed by a government with the purpose of generating revenue for the government rather than to protect domestic industries or to penalize foreign producers, as in the case of protective tariffs or dumping duties. An excise tax is a tax on specific goods or services, rather than on imports in general. An import quota limits the quantity of imports regardless of where they come from. Therefore, B is the best choice as it directly relates to the taxing of the imported automobiles for the purpose of generating revenue.

Question 6

A limit on the amount of a particular good that may be brought into a country during a given period of time is called a(n)

Accepted Answer

An import quota is a limit on the amount of a particular good that can be brought into a country during a given period of time, typically with the goal of protecting domestic producers. Import duties, import tariffs, and trade embargoes are all forms of trade restrictions, but they do not specifically limit the amount of a particular good that can be imported. An import deficit is a situation in which a country imports more goods than it exports, but it is not the same as an import quota.

Question 7

If it wants to reduce the dollars flowing out of the country, the United States can limit the number of Japanese cars being imported by imposing a(n)

Accepted Answer

An import quota is a government-imposed limit on the quantity of a particular good that can be imported into a country. By limiting the number of Japanese cars being imported, the United States can reduce the dollars flowing out of the country and improve its balance of trade.

Question 8

Any measure imposed by a government to favor domestic products over foreign products not involving taxes is a(n)

Accepted Answer

A nontariff barrier is a measure imposed by a government to favor domestic products over foreign products without involving taxes. Examples of nontariff barriers include quotas, subsidies, product standards, and government procurement policies.

Question 9

A restriction on the amount of a particular foreign currency that can be purchased or sold is a

Accepted Answer

A restriction on the amount of a particular foreign currency that can be purchased or sold is considered a foreign-exchange control. This control is put in place to manage a country's international reserves and stabilize their currency's value. It can limit the amount of currency leaving a country and can also limit the amount of currency that can be exchanged for the domestic currency.

Question 10

A complete halt to trading with a particular nation or in a particular product is called a(n)

Accepted Answer

An embargo is a complete halt to trading with a particular nation or in a particular product, making it the best choice. Stoppage, stay, closure, and barricade do not accurately describe this situation.

Question 11

China is selling school supplies in the United States for very low prices, even lower than the prevailing prices in China, and thus making it extremely difficult for American manufacturers to compete. This is referred to as

Accepted Answer

The practice of selling goods in foreign markets at prices lower than the prevailing prices in the home market is known as dumping. This is done to capture the market share and drive out local competition. In this case, China is dumping school supplies in the US market at very low prices, making it difficult for American manufacturers to compete.

Question 12

The Saudi Arabian government does not allow the consumption of alcoholic beverages within its country. The Saudi Arabian government is imposing a(n)

Accepted Answer

The answer of The Saudi Arabian government does not allow...

Question 13

The United States bans Cuban cigars and other Cuban products from entering the United States due to political difficulties. This action is called a(n)

Accepted Answer

An embargo is a government-imposed restriction that prohibits trade with one or more countries. In the case of the United States and Cuba, the ban on Cuban products such as cigars is an example of an embargo due to political difficulties between the two countries.

Question 14

When the United States levies a tax on coffee from Ecuador, this type of tax is a(n)

Accepted Answer

A tax on imports is called a tariff. In this case, the United States is imposing a tax on coffee coming from Ecuador, which is an imported good. Therefore, the correct answer is D - tariff.

Question 15

At present, the United States has an embargo against North Korea because

Accepted Answer

The United States has an embargo against North Korea due to the extremely poor political relations between the two countries, including North Korea's nuclear and missile programs and human rights abuses.

Question 16

Suppose France imposes a tax on agricultural products from the United States to help its own farmers. This describes a(n)

Accepted Answer

France imposing a tax on agricultural products from the United States to help its own farmers indicates a protective tariff. A protective tariff is imposed to protect domestic industries from foreign competition by raising the price of imported goods.

Question 17

The United States wishes to import no more than 100 million tons of sugar from India in any given year. The type of import restriction it should impose is a(n)

Accepted Answer

An import quota limits the quantity of a particular good that can be imported into a country, and this is the best choice for the United States to limit its sugar imports from India to 100 million tons. An import duty is a tax levied on imported goods, but it does not necessarily limit the quantity of imports. Foreign exchange controls and embargoes are more extreme measures that prohibit or severely restrict trade with a specific country. An export duty is a tax on goods as they leave a country, and it does not apply to imports.

Question 18

Another name for an import duty is a(n)

Accepted Answer

An import duty is another term for a tariff, which is a tax levied by a government on imported goods. This tax is usually a percentage of the value of the goods being imported and is meant to protect domestic industries from foreign competition.

Question 19

When the U.S. government will not allow meat from another country to be marketed in the United States, it is imposing a(n)

Accepted Answer

An embargo is a government-imposed restriction on trade in which it completely prohibits the import or export of goods or services. In this case, the U.S. government is not allowing meat from another country to be marketed in the United States, which suggests a complete ban on the trade. Therefore, the best option is E) embargo.

Question 20

An import duty has the effect of all of the following except

Accepted Answer

An import duty is a tax on imported goods. It increases the price of the product in the importing nation, reduces the number of units imported, creates a trade restriction, and protects a domestic industry from competition. However, it does not have a direct impact on the number of units exported.

Quiz 3: A: Exploring Global Business