When material inputs enter a country at a very low tariff while the final imported product is protected by a high tariff, the result tends to be a high rate of protection for domestic producers of the final product.

Question

Quizplus · Accepted Answer

This is because the low tariff on material inputs allows domestic producers to access them at a lower cost, which can reduce production costs and make them more competitive. However, the high tariff on the final imported product creates a barrier to entry for foreign producers, protecting domestic producers from competition. This combination of low input costs and high barriers to entry can result in a high rate of protection for domestic producers of the final product.

When Material Inputs Enter a Country at a Very Low