In 2002,the United States placed higher tariffs on imports of steel.According to the open-economy macroeconomic model this policy should have
A)reduced imports into the United States and made U.S.net exports rise.
B)reduced imports into the United States and made the net supply of dollars in the foreign exchange market shift right.
C)reduced imports of steel into the United States,but reduced U.S.exports of other goods by an equal amount.
D)reduced imports of steel into the United States and increased U.S.exports of other goods by an equal amount.

Question

Quizplus · Accepted Answer

Higher tariffs on steel reduce imports, but they can lead to a stronger dollar, making U.S. exports less competitive, thus reducing exports by an equal amount.

In 2002,the United States Placed Higher Tariffs on Imports of Steel.According