The Higher Price of Imported Products Due to Trade Barriers

question 330

Multiple Choice

The higher price of imported products due to trade barriers causes some consumers to shift their purchases to a domestically produced product that is now

• A) lower in price because import competition has risen.
• B) higher in price because import competition has risen.
• C) higher in price because import competition has declined.
• D) lower in price because import competition has declined.

---

Definitions:

Tariff

A tax imposed on imported goods and services, designed to increase the price and reduce the demand for foreign products.

Imports

Goods or services brought into one country from another for sale or use.

Production Quota

A limit set by authorities or organizations on the amount of a product that can be produced, often used to control supply and stabilize or increase prices.

Producer Surplus

The gap between the price at which producers agree to sell a good or service and the price they end up receiving.