After the sharp drop in oil prices, the U.S. Congress considered enacting a tariff on imported oil. According to proponents, such a tariff would do all of the following except
A) help reduce the federal budget deficit.
B) help strengthen the foreign trade deficit.
C) prop up a sagging domestic oil industry.
D) help cut the foreign trade deficit.
E) create a trade restriction.

Question

Quizplus · Accepted Answer

A tariff on imported oil would not strengthen the foreign trade deficit, but rather would likely worsen it by increasing the cost of imported oil and reducing demand for foreign products. The other options are possible outcomes of implementing such a tariff.

After the Sharp Drop in Oil Prices, the U