Table 4.1.Production Costs and Prices of Imported and Domestic VCRs

-Consider Table 4.1.The nominal tariff rate on imported VCRs equals:
A) 11.1 percent
B) 12.5 percent
C) 16.7 percent
D) 50.0 percent

Question

Table 4.1.Production Costs and Prices of Imported and Domestic VCRs
 
-Consider Table 4.1.The nominal tariff rate on imported VCRs equals:
A) 11.1 percent 
B) 12.5 percent 
C) 16.7 percent 
D) 50.0 percent

Quizplus · Accepted Answer

The formula for calculating the nominal tariff rate is (Tariff/Import price) x 100. In this case, the tariff rate is $50 and the import price is $400, so (50/400) x 100 = 12.5%. Therefore, the nominal tariff rate on imported VCRs is 12.5%.

Table 41Production Costs and Prices of Imported and Domestic VCRs