Which of the following is not true about a tariff?
A) It is a barrier to entry in a market.
B) It leads to a natural monopoly.
C) It is a tax.
D) It affects imported goods.

Question

Quizplus · Accepted Answer

Tariffs can lead to higher prices for imported goods and act as a barrier to entry, but they do not necessarily lead to a natural monopoly (a market with only one dominant firm). Tariffs are a form of tax that is imposed by a government on imported goods.

Which of the Following Is Not True About a Tariff