Economics 9708 · AS & A Level
Protectionism
100 practice questions on Protectionism, with worked solutions and instant marking.
A government abolishes the tariff on a product, as illustrated in the diagram. What change will occur in domestic production?
Feb/March 2016
What exists in a customs union but not in a free trade area?
Feb/March 2018
Which argument in support of protectionism is not usually regarded as economically valid?
Feb/March 2018
In the diagram, Sd represents the domestic supply of a product, Sw represents the world supply and Dd represents the domestic demand for the product. Once the country has been operating under a free trade system, it then prohibits all imports. What effect will this ban have on the revenue of domestic producers and world producers?
Feb/March 2019
Two countries trade with each other without any protectionist measures. They also levy a common external tariff on imports from all other countries. What arrangement have these two countries formed?
Feb/March 2019
Which kind of import control enables a country to build up a potential comparative advantage in a specific good?
Feb/March 2019
Explain how each of ‘a healthy US economy, a large US fiscal deficit and a strong US dollar’ could add to a US trade deficit.
Feb/March 2020
The diagram illustrates the impact of abolishing a tariff on imports of good X into country Y. What is the volume, in million units, of the additional international trade generated by removing the tariff?
Feb/March 2021
Explain how you would use the concept of cross-elasticity of demand to measure the effect on the demand for cars when the price of fuel for cars rises and when the price of public transport rises.
Feb/March 2021
A government abolishes its quota on imported laptops. Assuming a normal demand curve and an upward-sloping supply curve for laptops, what effects are likely for domestic laptop manufacturers?
Feb/March 2022
Which of the following is not a type of protectionism?
Feb/March 2022
Explain what is meant by ‘protectionism’ and describe two methods that could be used to protect this steel industry.
Feb/March 2022
The diagram illustrates the market for domestic and imported computers in an economy. The world price is p1. Which government policy would result in a price of p2?
Feb/March 2024
With the help of a formula, explain two reasons for an improvement in the terms of trade and consider how far an improvement in the terms of trade will benefit an economy.
Feb/March 2025
Discuss whether Australia and Thailand should have removed all tariffs at once.
May/June 2006
Explain what is meant by a current account deficit
May/June 2008
Explain the likely effects for Chinese bicycle manufacturers of the anti-dumping import duty introduced by the EU.
May/June 2010
Explain what factors could decide whether a country is classed as developed or developing.
May/June 2010
A criticism of trade protection is that it would raise
May/June 2011
One objection to trade protection is that it will raise
May/June 2011
A criticism of trade protection is that it will raise
May/June 2011
Explain how a country's various international transactions are recorded in its balance of payments account.
May/June 2011
Explain the limitations of the theory of comparative advantage in accounting for a country’s pattern of trade.
May/June 2011
What economic advantage could a major economy gain by imposing a tariff on imported goods?
May/June 2011
What economic advantage might a major economy gain by placing a tariff on imported goods?
May/June 2011
What economic advantage might a major economy gain by placing a tariff on imported goods?
May/June 2011
One major route by which a developing country may become a developed country is for government policy to focus on protecting domestic industry and investing in infrastructure. Do you agree that this is the most effective policy?
May/June 2011
The diagram indicates that the introduction of a tariff increases the price from $10 to $14. What is the amount of tax revenue generated?
May/June 2012
A government chooses to cut the quota for imported cars from 2000 to 1000 per year. What is likely to happen?
May/June 2012
Which statement regarding the effects of a tariff and a quota is correct?
May/June 2012
A government chooses to cut the quota on imported cars from 2000 to 1000 per year. What is likely to happen?
May/June 2012
Which point supports trade protection?
May/June 2012
The diagram indicates that introducing a tariff increases the price from $10 to $14. What is the amount of tax revenue generated?
May/June 2012
Use economic analysis to explain why international trade is beneficial.
May/June 2012
The European Union sets a quota on the number of garments imported from China. What is likely to happen as a result?
May/June 2012
In the diagram, D shows a country’s demand curve for an imported good. The world price of the good is OPW. Which area represents the deadweight loss to the country from setting an import tariff of PW − PC on the good?
May/June 2012
The European Union places a quota on the number of garments imported from China. What consequence is most likely?
May/June 2012
The diagram illustrates the effects of imposing an import tariff on wheat in a country. Which area shows the fall in consumer surplus caused by the tariff?
May/June 2013
Which of the following is a characteristic of a customs union?
May/June 2013
Which objective is most likely to be pursued by a government that raises tariffs on imported manufactured goods?
May/June 2013
Which feature is found in a customs union but not in a free trade area?
May/June 2013
Which factor would be least likely to limit international trade?
May/June 2013
Explain the meaning of the term ‘protection’ in the context of international trade, and describe two methods of protection used by governments.
May/June 2013
The European Union sets a quota on the quantity of garments brought in from Brazil. What consequence is most likely to result?
May/June 2013
A country is a large cotton producer. Its government places a tax on cotton exports. What effect will this have on the price of cotton in the domestic market and in the world market?
May/June 2014
A country manufactures washing machines. The government reduced both the tax on washing machines made in the country and the quota for imported foreign washing machines. What is the likely outcome?
May/June 2014
The diagram illustrates the impact on the quantity of an import in the domestic market when a tariff is removed and the import price falls to P1. By how much will the quantity of imports rise?
May/June 2014
Which of the following would not be a reason for a government to set an import quota?
May/June 2014
The European Union sets a quota on the quantity of garments brought in from China. What is likely to happen to the prices obtained by Chinese garment producers and to the prices paid by consumers of Chinese garments in Europe and the United States (US)?
May/June 2014
In the diagram, D represents a country's demand curve for an imported good. The country's government introduces an import tariff of PWPC on the good. Which areas show the resulting fall in consumer surplus and the resulting rise in government revenue?
May/June 2015
In what ways could trade protection weaken a country’s competitiveness in export markets?
May/June 2015
What does an economic union include that a customs union does not?
May/June 2015
What will increase as a result of the removal of a tariff?
May/June 2015
What key argument could a government in a small country put forward during a deepening global recession to defend raising import tariffs and introducing other trade protectionist measures?
May/June 2016
Which statement is not a valid reason for imposing an import tariff?
May/June 2016
For what reason might a government choose to raise the quota placed on imports?
May/June 2016
Use production possibility diagrams to explain how specialisation and international trade can improve the standard of living of consumers in a country.
May/June 2016
A small trading country chooses a policy of import substitution by making goods domestically. What is the most likely reason for this policy?
May/June 2017
Which government policy might be regarded as a protectionist policy?
May/June 2017
The diagram indicates that imposing a tariff increases a good’s world price from $10 to $14. What impact did this have on total expenditure on the good?
May/June 2017
Which government policy would decrease protectionism?
May/June 2017
In the diagram, D shows a country’s demand curve for an imported good. The government of the country introduces an import tariff equal to PWPC on this good. Which areas show the resulting fall in consumer surplus and the resulting rise in government revenue?
May/June 2018
A country’s exports face price-elastic demand. What impact would the introduction of export subsidies have on its balance of trade and on its terms of trade?
May/June 2018
On the diagram, D and S show the domestic demand and supply curves for a product. Sw shows world supply of the product at the world price of Pw. The product’s original domestic market equilibrium is at E1. If foreign trade were to be prohibited entirely, the domestic market equilibrium would move to E2. What would be the fall in consumer surplus if all foreign trade were prohibited?
May/June 2018
Which option about trade protection is correct?
May/June 2018
A certain good sold in the Barbados market might be provided by domestic producers, or by producers in Trinidad and Tobago, or by producers in the United States (US), at the prices listed in US dollars: Barbados $1.00; Trinidad and Tobago $0.85; US $0.75. At first, Barbados imposed a 20% ad valorem duty on imports from Trinidad and Tobago and the US. Barbados then entered a customs union with Trinidad and Tobago, using a common external tariff, also of 20%. From which countries would Barbados import the good before the customs union was created, and after the customs union was created?
May/June 2018
What would lower an economy’s protection from car imports?
May/June 2018
If an economy has a continuing balance of trade deficit, it may decide to impose tariffs on imports of manufactured goods. Under what conditions could tariffs eliminate a balance of trade deficit in the long term?
May/June 2018
What would be absent in a free market, open economy?
May/June 2018
Countries X and Y, both industrialised, trade with one another. Country X places a general tariff of 20% on imports from country Y. Under which circumstances would introducing the tariff be disadvantageous for country X?
May/June 2019
As the tariff on Indian goods imported into the US drops from 10% to 5%, what is the most likely effect on producer surplus and consumer surplus in the US?
May/June 2019
A country chooses to abolish all tariffs and participate in free international trade. What final decision must the country make before free trade can begin?
May/June 2019
The diagram illustrates the introduction of an import tariff. SW represents world supply. SW + tax shows world supply after the tariff has been introduced. Which statement is incorrect?
May/June 2019
The diagram illustrates what happens when an import quota is imposed in the market for good X. What is the change in domestic supply and how large is the import quota?
May/June 2019
Country X becomes part of a customs union with country Y and is going to abolish the tariff on its imports of good M from country Y. Under which conditions would trade creation in country X be the smallest?
May/June 2019
Describe, using Fig. 1.1, the way the yuan’s value against the US dollar changed from 2014 to 2017.
May/June 2019
Explain, using examples, what is meant by ‘protectionism’ and, with the aid of a diagram, show how export subsidies may be regarded as a form of protectionism.
May/June 2019
Explain the benefits of free trade as indicated by the principle of comparative advantage.
May/June 2019
Which of the following is not an example of protectionism?
May/June 2020
Which measure would not be included in a government subsidy designed to protect domestic producers from competition?
May/June 2020
In 2018, the United States (US) government imposed tariffs on a broad range of imports from China. What type of policy was the US government following?
May/June 2020
An economy that has long imposed substantial barriers to trade decides to move to completely free trade. Which outcome is most likely to rise in the short term?
May/June 2020
Explain why the theory of comparative advantage may not provide an accurate picture of the benefits of free trade.
May/June 2020
In 2018, the US introduced a tariff on steel imports. What is the most likely effect of this tariff on the US economy?
May/June 2020
In 2018, the US introduced a tariff on steel imports. What is the most likely effect of this tariff on the US economy?
May/June 2020
A small country brings in tractors from abroad. The government in this country chooses to place a quota on imported tractors. What is likely to happen to the price of imported tractors and the domestic output of tractors?
May/June 2021
The diagram illustrates the effect of country Y introducing a tariff on good X. What revenue, in US$ million, do producers of good X in country Y receive after the tariff has been introduced?
May/June 2021
Which of the following is not an aim of protectionism?
May/June 2021
The world market price of cars in country Y stands at US$10 000. At this price, domestic car producers provide 100 000 cars to the market, while domestic consumers buy 200 000 cars. The government of country Y introduces a 10% tariff on imported cars. Under what conditions would this tariff generate the greatest revenue for the government?
May/June 2021
Which of the following statements about trade protection is correct?
May/June 2021
Compare the change in the price level in Myanmar with that in Cambodia between 2016 and 2018.
May/June 2021
Explain how a free trade area is different from a customs union and explain two reasons why countries move towards tariff-free trade.
May/June 2021
The diagram illustrates how the supply curve for imports shifts from S–S1 to curve S–S2 following the government’s introduction of a trade protection measure. What form of protection is it?
May/June 2022
For what reasons might a country's government levy a tax on fuel exports?
May/June 2022
A small country has no tariffs and receives a perfectly elastic supply of smartphones from the rest of the world. Which statement is correct after a tariff is imposed?
May/June 2022
In a recent year, Japanese car manufacturers agreed to cap the number of cars exported to the USA. Which type of protectionism is this?
May/June 2022
Explain why a fixed exchange rate could create difficulties for a country that has one.
May/June 2022
Which feature would not be present in a free-market, open economy?
May/June 2022
The diagram indicates that introducing a tariff increases the world price of the product from $10 to $14. By what amount did the income of domestic producers rise because of the tariff?
May/June 2023
With the aid of one or more diagrams, explain the likely causes of a depreciation in a floating exchange rate and consider whether such a depreciation is always advantageous for an economy.
May/June 2023