Of the Following, Who Gains Because of Tariffs and Why

question 22

Multiple Choice

Of the following, who gains because of tariffs and why?

• A) Foreign producers because they earn more total revenue.
• B) Domestic buyers because they pay a lower price.
• C) Domestic buyers because they can be sure of buying high-quality products.
• D) Domestic producers of protected goods because they can sell at a higher price.
• E) Foreign governments because they gain more revenue.

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Definitions:

Economic Efficiency

A state where every resource is optimally allocated to serve each individual or entity in the best way while minimizing waste and inefficiency.

Tax Costs

are financial charges imposed by governments on individuals, businesses, or transactions to raise revenue for public projects and services.

Political Elections

The formal process through which individuals are selected to hold public office or represent a political party.

Counterproductive Use

Refers to actions or behaviors that negatively affect the intended outcome or overall productivity.