Principles of Economics Quiz: Week 4 Quiz 40 pts Time Remaining: 01:19.55 This Q

Question

Principles of Economics Quiz: Week 4 Quiz 40 pts Time Remaining: 01:19.55 This Question: 2 pts 150120(o complete) 10 This Quiz: 40 The United States has, from time to time, limited imports of steel from Europe The argument the United States uses tojustly this import quota is that O A. US national defense requires a strong steel industry O B. European steel is produced wilth lax environmental standards ° C. U S steel users must be protected trom cheaper but inferior foreign steel O D. the United States must protect its infant steel industry C E. Europe wants to dump steel at a price lower an its cost of production Who wins from this restriction? O A European steel producers only OB. US steel consumers onty O C. US steel consumers and European steel producers O D. US stoel producers and workers in the US steel industry Who loses from this restriction? A. O B. ° C. U s steel producers and European steel cnsurnors U S steel consumers and European stool producers European steel consumers only Click to select your answer oe@ o.1 Search the web and Windows

Explanation / Answer

1. The argument the United States uses to justify this import quota is that :

E. Europe wants to dump steel at a price lower than its cost of production

Explanation: The US generally argues that foreign steel exporters are dumping steel in the US in order to promote their export and this is hurting American Steel industry.

2. Who wins from this restriction:

D. US steel producers and workers in US steel industry

Explanation: US steel producers now don't need to compete with cheap foreign imports. They will have higher profits now and hire more workers and/or pay higher wages.

3. Who loses from this restriction:

B. US steel consumers and Europe steel producers

Explanation: US steel consumers will have to pay a higher price for steel and European steel producers will see fall in sales and profits.

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