SSC MTS EXAM

Detailed explanation-1: -Information about If tax is imposed on Chinese toys, what will happen? a)Chinese toy-makers will benefitb)Indian toy-makers will prosperc)Chinese toys will remain cheapd)Indian consumers will buy more Chinese toysCorrect answer is option ‘B’.

Detailed explanation-2: -The Chinese toys are far better in terms of cost of production and designs. Thus the excessive import of toys has enabled the Indian buyers to have a wider choice at lower prices. The Chinese toy makers also acquire an opportunity to expand their production and profits.

Detailed explanation-3: -Indian toy manufacturers have already reported that their revenues have increased significantly after the steps taken by the government to dis-incentivise toy imports into the country. Recently, India’s first toy cluster established by Aequs Private Limited began production at its first unit, with others to follow.

Detailed explanation-4: -This will lead to a healthy competition so that the quality of toys will improve. Also, Indian manufacturers will need to earn only reasonable profits. If Chinese toys were totally restricted, Indian manufacturers will be tempted to lower their quality and increase prices, thus harming the customers.