ECONOMICS (CBSE/UGC NET)

Detailed explanation-1: -The most common barrier to trade is a tariff–a tax on imports. Tariffs raise the price of imported goods relative to domestic goods (good produced at home). Another common barrier to trade is a government subsidy to a particular domestic industry. Subsidies make those goods cheaper to produce than in foreign markets.

Detailed explanation-2: -Trade barriers are often enacted to protect industries and workers within a country. This is referred to as protectionism. For example, tariffs, quotas and embargoes make foreign goods more expensive and less available.

Detailed explanation-3: -Sometimes referred to as “red tape, ” these barriers typically include quotas, boycotts, licences, standards and heavy regulations, local content requirements, restrictions on foreign investment, domestic government purchasing policies, exchange controls and subsidies.

Detailed explanation-4: -Embargoes are considered strong diplomatic measures imposed in an effort, by the imposing country, to elicit a given national-interest result from the country on which it is imposed.