If a Canadian manufacturing firm uses some imported inputs in the production process,the most accurate measure of the rate of protection is the
A) specific tariff
B) ad valorem tariff
C) nominal tariff
D) effective tariff

Question

Quizplus · Accepted Answer

The effective tariff measures the total amount of customs duties and taxes, including those applied to imported inputs in the production process, and is the most accurate measure of the rate of protection. The specific tariff and ad valorem tariff only measure the duty applied to a specific quantity or a percentage of the value of the imported good, respectively. The nominal tariff is the official rate of duty, but it does not take into account the exemptions and reductions applied to specific goods or sectors.

If a Canadian Manufacturing Firm Uses Some Imported Inputs in the Production