Asked by Aspen Arellano on May 01, 2024
Verified
Tariffs create larger gains to domestic producers than losses to domestic consumers.
Domestic Consumers
Individuals or households within a country that purchase goods and services for personal use or consumption.
Domestic Producers
Companies or individuals that produce goods and services within a country's borders, contributing to the domestic economy.
- Comprehend how tariffs, quotas, and free trade agreements influence the efficacy of global trade.
Verified Answer
GB
gizeal bahatiMay 03, 2024
Final Answer :
False
Explanation :
Tariffs increase the price of imported goods, making domestic goods more competitive. This may result in increased profits for domestic producers, but it also results in higher prices for domestic consumers who may have to pay more for non-domestic alternatives. Therefore, the losses to domestic consumers can be larger than the gains to domestic producers.
Learning Objectives
- Comprehend how tariffs, quotas, and free trade agreements influence the efficacy of global trade.