BUSINESS ADMINISTRATION
INTERNATIONAL MARKETING
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Question
[CLICK ON ANY CHOICE TO KNOW THE RIGHT ANSWER]
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To encourage consumers to buy goods made in their own country.
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To increase trade between two countries.
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To stop trade completely.
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To block dangerous goods from entering the country
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Detailed explanation-1: -Tariffs have historically been a tool for governments to collect revenues, but they are also a way for governments to try to protect domestic producers. As a protectionist tool, a tariff increases the prices of imports. As a result, consumers would choose to buy the relatively less expensive domestic goods instead.
Detailed explanation-2: -Tariffs have three primary functions: to serve as a source of revenue, to protect domestic industries, and to remedy trade distortions (punitive function). The revenue function comes from the fact that the income from tariffs provides governments with a source of funding.
Detailed explanation-3: -Tariffs are used to restrict imports. Simply put, they increase the price of goods and services purchased from another country, making them less attractive to domestic consumers.
Detailed explanation-4: -Tariffs are a tax on imports paid by importing companies in the country that imposed the tax. The cost is usually passed on to consumers. Tariffs are meant to protect domestic industries by raising prices on their competitors’ products.
Detailed explanation-5: -The purpose of a tariff, which a government imposes to raise the cost of a particular import, is to limit or reduce the amount of that good imported into the country. Making an import more expensive can improve the economics of producing that product domestically.