In a large nation,who bears the burden of the import tariff?
A)domestic import-competing producers
B)foreign producers of the imported good
C)domestic consumers only
D)domestic consumers and foreign producers of the imported good

Question

Quizplus · Accepted Answer

When a nation imposes an import tariff, both domestic consumers and foreign producers of the imported good bear the burden. This is because the tariff increases the price of the imported good, which reduces the quantity demanded by domestic consumers. Foreign producers may also have to lower their prices to compete with domestic firms, resulting in lower profits. Therefore, both domestic consumers and foreign producers share the burden of the import tariff.

In a Large Nation,who Bears the Burden of the Import