Consumers receive more consumers' surplus when tariffs exist than when they do not exist.

Question

Quizplus · Accepted Answer

Tariffs increase the price of imported goods, which reduces consumer surplus as consumers have to pay more for the same product. Therefore, consumers receive less consumer surplus when tariffs exist compared to when they do not exist. Tariffs may benefit domestic producers by protecting them from foreign competition, but they do not benefit consumers.

Consumers Receive More Consumers' Surplus When Tariffs Exist Than When