In the importing country, the most likely effects of tariffs and/or import quotas is to _______ prices and ________ consumption of the protected goods.

Question

Quizplus · Accepted Answer

Tariffs and/or import quotas work by increasing the price of imported goods, making them less attractive to consumers. As a result, domestic producers of similar goods can sell their products at a higher price, leading to an increase in prices. However, the higher prices also reduce consumption of the protected goods, as consumers may switch to cheaper alternatives.

In the Importing Country, the Most Likely Effects of Tariffs