When a tariff is imposed on a good,domestic consumers of the good ________ and domestic producers of the good ________.
A) win; lose
B) lose; win
C) win; win
D) lose; lose
E) lose; neither win nor lose

Question

Quizplus · Accepted Answer

When a tariff is imposed on a good, the price of the good increases, which leads to a reduction in demand. Domestic consumers are negatively affected as they need to pay a higher price for the same product. On the other hand, domestic producers benefit from this as they face less competition from cheaper imports and can sell their product at a higher price. Therefore, domestic consumers lose, while domestic producers win.

When a Tariff Is Imposed on a Good,domestic Consumers of the Good