Import tariffs generally _______ the output of domestic producers of the affected products and also _______ the output of domestic exporters.
A) decrease; decrease
B) decrease; increase
C) increase; decrease
D) increase; increase

Question

Quizplus · Accepted Answer

Import tariffs generally increase the output of domestic producers of the affected products because they make imported goods more expensive, thus reducing competition for domestic producers. However, tariffs can lead to retaliatory measures from other countries, potentially decreasing the output of domestic exporters as their goods become more expensive in foreign markets.

Import Tariffs Generally _______ the Output of Domestic Producers of the Affected