Learning Path
Question & Answer1
Understand Question2
Review Options3
Learn Explanation4
Explore TopicChoose the Best Answer
A
Tariffs increase the price of imported goods, making domestic products more competitive.
B
Tariffs lead to an increase in overall consumer welfare by lowering prices.
C
The imposition of tariffs can result in a decrease in the quantity of imports.
D
Tariffs typically decrease government revenue by discouraging trade.
E
Tariffs may lead to retaliatory measures from trading partners, affecting global trade dynamics.
Understanding the Answer
Let's break down why this is correct
Answer
Tariffs are taxes that a government places on imported goods, and they can have several effects on markets. First, tariffs make imported goods more expensive, which encourages people to buy domestic products instead. For example, if a country imposes a tariff on foreign cars, consumers might choose to buy local cars instead because they are cheaper. This can help local businesses grow but might also lead to higher prices for consumers. Additionally, while tariffs can protect local jobs, they can also lead to trade tensions with other countries, affecting international relationships.
Detailed Explanation
Other options are incorrect because Some think tariffs make local goods cheaper; People might believe tariffs lower prices for everyone.
Key Concepts
Tariffs
Market equilibrium
International trade
Topic
Effects of Tariffs on Markets
Difficulty
medium level question
Cognitive Level
understand
Ready to Master More Topics?
Join thousands of students using Seekh's interactive learning platform to excel in their studies with personalized practice and detailed explanations.