ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The most direct barrier to trade is an embargo– a blockade or political agreement that limits a foreign country’s ability to export or import. Embargoes still exist, but they are difficult to enforce and are not common except in situations of war. The most common barrier to trade is a tariff–a tax on imports.

Detailed explanation-2: -The main types of trade barriers used by countries seeking a protectionist policy or as a form of retaliatory trade barriers are subsidies, standardization, tariffs, quotas, and licenses.

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: -Quotas are types of trade barriers that restrict how much of a product can be imported into a country.