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How Does the Imposition of a Tariff Reduce the Price

Question 161

Multiple Choice

How does the imposition of a tariff reduce the price of imports?


A) At the lower quantity supplied, the price to the importer is lower than if there were free trade.
B) At the lower quantity demanded, the price to the importer is lower than if there were free trade.
C) Supply of the product is increased from domestic production, reducing the price of the imports.
D) Demand for the product is decreased, so that price must fall.

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