Research studies indicate that:

A) U. S. producers gain more from tariffs than U. S. consumers lose.

B) the costs of trade restrictions are proportionately higher for high-income groups than for low-income groups.

C) the revenue from tariffs equals the total cost that tariffs impose on consumers.

D) U. S. consumers lose more from tariffs than U. S. producers gain

Question

Business

Carolyn Fletcher

2 December, 10:55

Research studies indicate that:

A) U. S. producers gain more from tariffs than U. S. consumers lose.

B) the costs of trade restrictions are proportionately higher for high-income groups than for low-income groups.

C) the revenue from tariffs equals the total cost that tariffs impose on consumers.

D) U. S. consumers lose more from tariffs than U. S. producers gain

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Answers (1)

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Aidan Zavala · Answer 1

Option D US consumers lose more from tariffs than U. S. producers gain

Explanation:

The reason is that the US has imposed tariffs on the import of goods to overcome the comparative advantage of the other countries. So by imposing tariffs the US producer's products become inexpensive and protects them from the foreign countries with comparative advantage in similar products. This means the US consumer is buying expensive products and don't motivates the US producer to invest in efficiency and that the size of the industry may be at the growth stage or the producer's size is very small which means it can not compete with the competitors in the international market. So as a result the US consumer suffer more because they pay higher payments and are forced to buy expensive American products which is less in value to the consumer than the value it generates to the producers.