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Tariff on automobiles
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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