In 2013 the United States reduced the tariff on ethanol. This tariff reduction ________ the U.S. production of ethanol and ________ the total U.S. consumption of ethanol.

Question

Quizplus · Accepted Answer

Reducing the tariff on ethanol makes imported ethanol cheaper, which could decrease domestic production due to increased competition from imports. However, the lower price overall (including both domestic and imported ethanol) would likely increase total consumption in the U.S.

In 2013 the United States Reduced the Tariff on Ethanol