If Canada imposes a tariff on imported steel, the tariff

Question

Quizplus · Accepted Answer

If Canada imposes a tariff on imported steel, it will raise the price of foreign steel, making it less competitive with domestic steel. This would make domestic steel more attractive to Canadian consumers, causing an increase in domestic demand. However, this would not necessarily lead to an increase in total consumption of steel. The Canadian production of steel may increase due to the increased demand for domestic steel, but decrease due to the increased price of steel-making inputs that are imported with a tariff imposed on them. Finally, the imposition of a tariff on imported steel may increase employment in the Canadian steel industry as demand for domestic steel increases.

If Canada Imposes a Tariff on Imported Steel, the Tariff