A tariff designed to eliminate foreign competition completely will be expected to raise:
A) either a large or a small amount of revenue depending on the magnitude of the tariff imposed.
B) a relatively large amount of tax revenue.
C) an amount of revenue equal to the amount of the tariff multiplied by the volume of exports.
D) a relatively small amount of tax revenue.

Question

Quizplus · Accepted Answer

A tariff designed to eliminate foreign competition completely would likely result in a decrease in imports, thus generating relatively small tax revenue as there would be fewer goods to tax.

A Tariff Designed to Eliminate Foreign Competition Completely Will Be