If a tariff is imposed in a country that is too small to have global market power, the domestic consumer will face a price, and the price paid to foreign producers will .

Question

Quizplus · Accepted Answer

When a small country imposes a tariff, it cannot influence world prices. Therefore, the domestic consumer price increases by the amount of the tariff, but the price paid to foreign producers remains unchanged.

If a Tariff Is Imposed in a Country That Is