Jim Whitney
Open economy policy options
 
    1. Consider the following domestic market diagram for a small-country importer:
 
    Indicate which numbered arrow above corresponds to each of the following policy options:
    ___ a. an import tariff
    ___ b. a production tax
    ___ c. a consumption tax
    ___ d. a production subsidy
    ___ e. a consumption subsidy
 
    2. Consider the following domestic market diagram for a small-country exporter:
 
    Indicate which numbered arrow above corresponds to each of the following policy options:
    ___ a. an export tax
    ___ b. a production tax
    ___ c. a consumption tax
    ___ d. an export subsidy
    ___ e. a production subsidy
    ___ f. a consumption subsidy