Ceteris paribus,tariffs and nontariff barriers on imported factor inputs result in
A)An increase in the price level and a decrease in unemployment.
B)An increase in the price level and an increase in unemployment.
C)A decrease in the price level and a decrease in unemployment.
D)A decrease in the price level and an increase in unemployment.

Question

Quizplus · Accepted Answer

Tariffs and non-tariff barriers on imported factor inputs make these inputs more expensive for domestic producers. This increases production costs, leading to higher prices for consumers (an increase in the price level). Additionally, higher production costs can reduce demand for these inputs, potentially leading to lower production levels and higher unemployment.

Ceteris Paribus,tariffs and Nontariff Barriers on Imported Factor Inputs Result