The imposition of a tariff on a good produced by a monopolist provides it with additional protection because the tariff
A) reduces competition from imports by raising the import price.
B) prevents entrepreneurs from entering the market.
C) is added to the firm's profits.
D) allows more imports into the country.

Question

Quizplus · Accepted Answer

A tariff on a good produced by a monopolist reduces competition from imports by raising the import price, making the monopolist's goods relatively more competitive in the domestic market.

The Imposition of a Tariff on a Good Produced by a Monopolist