Tariffs result in a loss of national social welfare because
A) domestic consumption decreases and domestic production increases.
B) domestic consumption increases and foreign production increases.
C) foreign consumption decreases and domestic production decreases.
D) domestic consumption increases and domestic production decreases.

Question

Quizplus · Accepted Answer

Tariffs lead to higher prices for imported goods, reducing domestic consumption and encouraging inefficient domestic production, which results in a net welfare loss.

Tariffs Result in a Loss of National Social Welfare Because