Cambridge International AS and A Level Economics: Protectionism (9708) – Practice Questions

These are original questions written for Marlbridge, for revision and practice on this content. They are not reproduced past-paper questions, and they do not replicate the exam’s exact structure, question count or mark tariffs – examination boards hold copyright in their own papers. Use these alongside the official past papers from your board or school.

These questions cover section 6.2 (Protectionism) of the Cambridge International AS & A Level Economics 9708 syllabus for examination in 2026, 2027 and 2028. It is AS Level content, topic 6. All countries, firms and figures are invented. Revise first with the study guide or the revision notes. Course home: Cambridge A Level Economics. Tick off progress on the checklist.

Questions

1. Country E (illustrative) imports 90 000 tonnes of ceramic tiles a year at a world price of 40 per tonne. It adds a 15% tariff, and imports fall to 66 000 tonnes.

(a) Calculate the price per tonne after the tariff. [1] (b) Calculate the tariff revenue. [2] (c) Calculate the percentage fall in imports. [2] (d) Divide your answer to (c) by the percentage price rise and comment on the result. [2]

2. Distinguish between a tariff and an import quota. [3]

3. In Country A (illustrative), home demand is Qd = 300 − 2P and home supply is Qs = 2P − 60. The world price is 60. A tariff of 10 per unit is introduced.

(a) State imports before and after the tariff. [3] (b) Calculate tariff revenue. [1] (c) Calculate the fall in consumer surplus. [2] (d) Calculate the net welfare loss. [2]

4. Use the market in question 3. The government replaces the tariff with an import quota of 80 units.

(a) Show that the home price becomes 70. [2] (b) Calculate the value of the quota licences. [1] (c) Licences go to foreign exporters. Calculate the net loss to Country A and compare it with the tariff. [3] (d) Give one reason a government might still choose a quota. [2]

5. Explain why a government might impose an embargo on a product, and one likely effect on the home price. [4]

6. A firm in Country G (illustrative) has a unit cost of 90. Rivals sell at 84. The government pays an export subsidy of 12 per unit.

(a) Find the lowest price at which the firm can export without a loss. [1] (b) It exports 150 000 units. Calculate the cost to the government. [1] (c) The sales support 360 jobs. Calculate the cost per job. [1] (d) Explain one drawback of the subsidy. [3]

7. A consignment of fresh fruit from Country H (illustrative) is worth 25 000. Paperwork costs 750. The consignment waits 3 days and loses 2% of its value a day.

(a) Express the paperwork cost as a percentage of value. [1] (b) Calculate the total extra cost as a percentage of value. [2] (c) Compare it with a 5% tariff. [1] (d) Explain why a government might choose red tape over a tariff. [2]

8. A new firm in Country J (illustrative) has a unit cost of 130. The world price is 100. Its cost is expected to fall by 8% a year.

(a) Calculate the tariff rate needed to match the world price. [2] (b) Find the first year in which its cost is below 100. [3] (c) Explain two risks of this protection. [2]

9. A firm in Country K (illustrative) sells 400 000 units abroad at 55. Its unit cost is 60 and its home price is 70.

(a) Calculate its total loss on these sales. [2] (b) Calculate the duty that would raise the price to the home price, as a percentage of 55. [2] (c) State one reason a firm may sell at a loss. [1]

10. Country N (illustrative) has a steel industry. A 20% tariff would protect 500 jobs and raise steel prices by 12%. Steel-using firms spend 900 million a year on steel. Evaluate whether the tariff should be introduced. [10]

Answers

1. (a) 15% of 40 = 6, so the price is 46 [1] [1] (b) Tariff per tonne = 6 [1]. Revenue = 6 × 66 000 = 396 000 [1] [2] (c) Fall = 24 000 [1]. 24 000 ÷ 90 000 = 26.7% [1] [2] (d) 26.7 ÷ 15 = −1.78 [1]. Imports respond more than proportionally to the price rise, so the tariff cuts imports strongly [1] [2] Examiner insight: Revenue uses the imports left after the tariff. Answers gain credit for showing the per-unit figure before multiplying.

2. A tariff is a tax on imports [1]. A quota is a limit on the quantity imported [1]. A tariff works through price and raises revenue, while a quota fixes quantity and its price effect follows from that [1] [3] Examiner insight: A distinction needs both items compared. Define each, then state the difference.

3. (a) Before: Qd = 300 − 120 = 180, Qs = 120 − 60 = 60, imports 120 [1]. After: price 70, Qd = 160 [1], Qs = 80, imports 80 [1] [3] (b) 10 × 80 = 800 [1] [1] (c) ½ × (180 + 160) × 10 = 1 700 [2] [2] (d) Producer gain = ½ × (60 + 80) × 10 = 700 [1]. Net loss = 1 700 − 700 − 800 = 200 [1] [2] Examiner insight: The net loss is two triangles. Checking that 100 + 100 matches the answer shows the working is consistent.

4. (a) Qd − Qs = 80 gives 300 − 2P − (2P − 60) = 80 [1]. 360 − 4P = 80, so P = 70 [1] [2] (b) (70 − 60) × 80 = 800 [1] [1] (c) Consumer loss 1 700 less producer gain 700 = 1 000 [1]. No revenue reaches Country A, so the loss is 1 000 [1], compared with 200 under the tariff [1] [3] (d) Imports are fixed at 80 whatever happens to demand [1], so the government controls the quantity precisely [1] [2] Examiner insight: The tariff and the quota give the same price here. The difference is who receives the 800, and answers gain credit for saying so.

5. Possible reasons are political, security, health or ethical [1]. For example, a ban on a country’s goods in response to its conduct [1]. With imports stopped, supply falls [1], so the home price rises towards the no-trade level [1] [4] Examiner insight: A reason and an effect both need developing. Naming a reason without explaining it earns little.

6. (a) 90 − 12 = 78 [1] [1] (b) 12 × 150 000 = 1 800 000 [1] [1] (c) 1 800 000 ÷ 360 = 5 000 [1] [1] (d) Taxpayers pay 1.8 million for the benefit [1], which may keep a high-cost firm going [1], and foreign rivals may retaliate against Country G’s exports [1] [3] Examiner insight: Answers that link the drawback to the figure just calculated read as more convincing than a general statement.

7. (a) 750 ÷ 25 000 = 3% [1] [1] (b) Spoilage = 3 × 2% = 6% [1]. Total = 3% + 6% = 9% [1] [2] (c) 9% is 4 percentage points higher than 5% [1] [1] (d) Red tape is harder to see than a tariff [1], and can be presented as safety or process rules [1] [2] Examiner insight: Percentage points and percentages are different. Using the right term avoids a lost mark.

8. (a) (130 − 100) ÷ 100 = 30% [2] [2] (b) Cost = 130 × 0.92 per year [1]. Year 3: 101.23, still above 100 [1]. Year 4: 93.13, so year 4 [1] [3] (c) The protection may never be removed, because the industry lobbies to keep it [1]. The cost may not fall as forecast [1] [2] Examiner insight: Checking the year before and the year of the crossing shows the answer is not a guess.

9. (a) Loss per unit = 60 − 55 = 5 [1]. Total = 5 × 400 000 = 2 000 000 [1] [2] (b) Duty = 70 − 55 = 15 [1]. 15 ÷ 55 = 27.3% [1] [2] (c) To win market share and drive rivals out [1] [1] Examiner insight: State what the percentage is of. Here the base is 55, not 70.

10. Evaluation points, each worth one:

• Steel firms and 500 workers gain protection [1].
• Steel prices rise 12% [1].
• Steel-using firms pay 900 × 12% = 108 million more [1].
• Cost per job = 108 ÷ 500 = 0.216 million, or 216 000 [1].
• This is a high cost per job unless wages are very high [1].
• Higher costs may reduce output in steel-using industries [1].
• Retaliation may hit exporters [1].
• Strategic arguments may justify protection [1].
• A temporary tariff is better than a permanent one [1].
• Judgement: the tariff is hard to justify on cost grounds alone, unless steel is strategic and the tariff has an end date [1] [10] Examiner insight: Answers that reach a supported judgement and compare cost with benefit read as evaluation. A list of points does not.

Where marks are usually lost

• Using pre-tariff imports for revenue.
• Giving the consumer loss as the net loss.
• Forgetting that licence value goes to someone.
• Confusing percentage points with percentages.
• Calling red tape a tax.
• Listing arguments with no judgement.
• Missing the effect on consumers or foreign exporters.
• Giving a percentage with no base.

Next steps

• Review the revision notes and the study guide.
• Course hub: Cambridge A Level Economics, and the checklist.
• Take the free 10-minute diagnostics.
• Book a free trial class.

Official syllabus

Cambridge International AS & A Level Economics 9708 syllabus for examination in 2026, 2027 and 2028, published by Cambridge University Press & Assessment, section 6.2.