Tariffs :(
Tariffs are considered a __
Tax
A quota is a what?
A limit on imported goods.
An embargo is a what?
A ban on trading goods and services.
What is a subsidy?
When the government gives money (payment) to help a domestic producer.
The US has decided to protect American tire companies. They want to increase the price of foreign made tires to encourage people to buy domestically. What trade reg. would they use?
A tariff
Stakeholder group negative affected by a tariff.
Domestic Consumers
What impact does a quota have on domestic supply and price?
Supply decreases and price increases
An embargo affects these types of goods and services.
Imported and exported goods and services.
Subsidies generally have positive results. What is the only stakeholder group that does not see a positive effect and why?
Foreign producers because subsidies lower the cost of domestically produced goods and services.
A quota was placed on foreign coffee. What stakeholder would say this:
I'm not worried about the quota! This doesn't affect the price or supply of my coffee.Foreign consumer
A tariff would be most beneficial to a ____ producer.
Domestic Producer
These two stakeholder groups are negatively impacted by quotas.
Domestic Consumers and Foreign Producers
The country the US has long had an embargo on.
Cuba
Subsidies can lower the cost of goods for domestic consumers. However, there is a downside. What is it?
Subsidies can lead to tax increases.
Corn costs more to produce than it can be sold for. Farmers lose profits. But corn is in just about all food products! What trade regulation can the government use to keep farmers growing food?
A subsidy
Tariffs only apply to what goods and services?
Imported goods and services
Quotas apply to these types of goods and services which benefits this stakeholder group.
Imported goods and services which benefits domestic producers.
Domestic producers because and embargo limits competition.
What does a subsidy do that helps domestic producers?
It helps lower or offset the cost of production.
While it does cost consumers more, this trade regulation ensures that the products that are made are safer.
Product Regulation
This stakeholder group is unaffected by tariffs.
Foreign Consumers
Which of the following is untrue of a quota?
+ impacts domestic producers
-impacts domestic consumers
-impacts foreign producers
+ impacts foreign consumers
+Impacts foreign consumers (foreign consumers are unaffected by a quota).
Why do countries usually use embargoes?
As a punishment or political pressure.
Why does the government give subsidies?
-To protect domestic producers.
-To ensure important goods or services are available to everyone.
-To encourage production of a specific good or service.
A domestic consumer says "I love that the price of solar panels has come down and is now more affordable to put on my new home!"
What regulation would lead to this?
A subsidy