ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -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-2: -The main purpose of a tariff is to increase the price of imported goods in order to protect domestic industries from foreign competition and to raise revenue for the government.

Detailed explanation-3: -Obviously, a tariff also generates revenues for the government of the importing country (revenue function). Tariffs therefore benefit the government and producers of the importing country in the form of tax revenues and producer surpluses at the expense of its consumers in the form of higher prices.

Detailed explanation-4: -Tariffs are intended to protect local industries by making imports more expensive and driving consumers to domestic producers. Unfair trading practices. Some tariffs are meant to counteract specific measures taken by foreign countries or firms.

Detailed explanation-5: -Tariffs increase the price of goods and services in domestic markets by applying a tax on imported goods that is paid by the domestic importer. To cover the increased costs, the domestic importer then charges higher prices for the goods and services.