Trade Barriers Lesson

What is a tariff?

• A tax on exports

• A law to ban certain imports

• A tax on imports

• A subsidy for domestic goods

What is the purpose of a protective tariff?

• To increase the number of foreign goods in the market

• To limit the number of foreign goods that can be sold in a country

• To completely ban all foreign goods

• To reduce taxes on imports

What does an imports quota do?

• The minimum price of imported goods

• The total cost of imports allowed per year

• The fixed amount of an item that can be imported

• The countries from which imports are allowed

What is a voluntary trade restriction?

• A law that completely stops trade between two countries.

• An agreement between two countries that isn't a law but limits imports.

• A government policy that taxes foreign goods to boost local business.

• A worldwide agreement to enhance trade by reducing tariffs.

What is a trade embargo?

• A policy that allows free trade between all nations without any restrictions.

• An agreement that increases trade activities among neighboring countries.

• A law that cuts off imports from and exports to specific countries.

• A financial aid given to a country to enhance its economic stability.

What is a pro of protective tariffs according to the image?

• They make foreign goods cheaper

• They help industries at home

• They reduce job opportunities

• They encourage international trade

What is a disadvantage of maintaining a high standard of living as per the image?

• It helps keep American wages higher

• It supports failing industries

• Companies could afford to pay higher wages

• Companies could not afford to pay higher wages

What is a pro of specialization?

• It limits competition

• It guarantees the greatest selection/choice

• It reduces economic growth

• It increases dependency on other countries

What is a con of overspecializing in economies?

• It promotes diversity

• It guarantees the greatest selection

• It can hurt economies

• It increases national security

According to the text, why might vital industries like steel and energy need protection?

• To increase exports

• To reduce competition

• To ensure national security

• To promote free trade