If protective import-restricting tariffs are imposed by a country, in the majority of cases that nation's producers end up
A) receiving a higher price for the good than they otherwise would.
B) receiving a lower price for the good than they otherwise would.
C) producing less of the good than they otherwise would.
D) receiving a lower profit for the domestic good than they otherwise would.

Question

Quizplus · Accepted Answer

With protective import-restricting tariffs, the price of imports is raised, making it more expensive for consumers to buy them. This results in an increase in demand for the domestically produced goods, leading to a higher price for the good than they otherwise would. This benefits the domestic producers as they are able to sell their products at a higher price and thus generate greater profits.

If Protective Import-Restricting Tariffs Are Imposed by a Country, in the Majority