Answer to Question #210162 in Economics of Enterprise for Abel

Question

Discuss in detail about the effect of tariff on a large country and developing country.

Answer 1

Effects of a tariff on a large country;

When a large importing country imposes a tariff, the price of commodities in the global market will increase.

Effects of a tariff on a developing country;

Tariffs raise prices and reduce the amount of goods and services offered to consumers, resulting in lower income, fewer jobs, and lower economic productivity.