Asked by Charisma Bennett on May 04, 2024
Verified
The imposition of a tariff on a product is least likely to result in a(n)
A) increase in efficiency in the domestic industry producing the product.
B) increase in the price of the product.
C) decrease in the quantity of imports.
D) decrease in the real incomes of workers in other industries.
Tariff
A tax imposed on imported goods and services to control trade volumes, protect domestic industries, or generate revenue.
Efficiency
The optimal allocation and utilization of resources to maximize productivity and minimize waste in the production of goods and services.
Domestic Industry
The industries that produce goods and services within a country's own borders.
- Comprehend the impact of trade restrictions on price levels and quantity within the local market.
- Distinguish between diverse trade policy forms and their effects on both local and international markets.
Verified Answer
MM
Michael MarescoMay 05, 2024
Final Answer :
A
Explanation :
Tariffs typically do not lead to an increase in efficiency within the domestic industry. Instead, they can create a protective barrier that reduces competitive pressures, potentially allowing domestic firms to maintain or increase prices without necessarily improving efficiency, quality, or innovation.
Learning Objectives
- Comprehend the impact of trade restrictions on price levels and quantity within the local market.
- Distinguish between diverse trade policy forms and their effects on both local and international markets.