ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -Why might a government want to restrict trade? If domestic industries cannot compete against foreign industries, the government will restrict trade to help the domestic industries develop. Governments may also restrict trade to foster business at home rather than encouraging business to move out of the country.

Detailed explanation-2: -Trade barriers such as tariffs raise prices and reduce available quantities of goods and services for U.S. businesses and consumers, which results in lower income, reduced employment, and lower economic output.

Detailed explanation-3: -Without international trade, few nations could maintain an adequate standard of living, particularly those of smaller size. With only domestic resources being available, each country could only produce a limited number of products, and scarcity would be prevalent.

Detailed explanation-4: -The major obstacles to international trade are natural barriers, tariff barriers, and nontariff barriers.