Answer to Question #227768 in Macroeconomics for lucy

Question

A tariff is:

1. A tax on exported goods.
2. A source of revenue to the exporting nation.
3. A tax on imported goods.
4. A tax on foreign property.
5. A form of quota.

Answer 1

Option 3. A tax on imported goods.

A tariff is a kind of tax that is imposed by the government on the import of commodities. Generally, tariff restricts the import of foreign goods and increases the producer surplus for domestic producers and decreases the surplus for domestic consumers. Moreover, the effect of tariff can be seen that the price rises for imported goods after the tariff.