A Canadian tariff imposed on items that can be produced more cheaply abroad

Question

Quizplus · Accepted Answer

A tariff on items that can be produced more cheaply abroad creates a social loss because it raises the cost of importing those goods, which leads to higher prices for consumers and reduces the quantity of goods exchanged between countries. This can also result in retaliation from the foreign country, leading to a trade war and further negative economic impacts. While it may initially benefit Canadian producers, it ultimately harms consumers and the economy as a whole.

A Canadian Tariff Imposed on Items That Can Be Produced