Tariff on automobiles imported from germany


Question: Suppose the United States increases the tariff on automobiles imported from Germany (and other foreign countries). What is the effect of this tariff-rate increase on

a) the price of automobiles in the United States;

b) the total number of cars sold in the U.S. during the year;

c) the number of cars produced by and employment in the German automobile industry;

d) production by and employment in the U.S. automobile industry;

e) german income obtained by selling cars in the U.S;

f) the German demand for goods produced in the U.S;

g) the production of and employment in those U.S. industries that now export goods to Germany;

h) the allocation of resources in the U.S. economy; and

i) the allocation of the world's resources?

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Macroeconomics: Tariff on automobiles imported from germany
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