1. The effective rate of protection (ERP) is a weighted average of nominal tariffs and tariffs on imported inputs. It ha

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1 The Effective Rate Of Protection Erp Is A Weighted Average Of Nominal Tariffs And Tariffs On Imported Inputs It Ha 1 (82.43 KiB) Viewed 52 times

1. The effective rate of protection (ERP) is a weighted average of nominal tariffs and tariffs on imported inputs. It has been noted that in most industrialized countries, the nominal tariffs on raw materials or intermediate components or products are lower than on final-stage products meant for final markets. Clearly define what is meant by a cascading tariff and the economic theory behind it. Why would countries design their tariff structures in this manner? Who tends to be helped, and who is harmed by this cascading tariff structure? [1/2 page, 20 points].