A tariff is MOST likely to _____ prices and _____ domestic consumption of the good or service being protected.

Question

Quizplus · Accepted Answer

A tariff is a tax on imported goods, which makes them more expensive for consumers. As a result, it is most likely to increase prices for the protected good, as the tariff makes the imported good more expensive compared to the domestic good. This increase in price makes it more likely that consumers will choose to purchase the domestic good instead, thus decreasing consumption of the imported good. Therefore, the correct answer is B: increase prices and decrease domestic consumption of the good or service being protected.

A Tariff Is MOST Likely to _____ Prices and _____

A Tariff Is MOST Likely to _ Prices and _