Understanding Trade Wars

The video explores the concept of trade wars, using an analogy from Game of Thrones to explain how tariffs and subsidies can lead to economic conflicts between countries. It discusses the causes of trade wars, such as protecting domestic industries or punishing other countries for unfavorable practices. The video also examines who might win or lose in a trade war, highlighting the impact on consumers and the economy. Finally, it delves into the US-China trade tensions under President Trump, noting the unpredictability and global impact of his approach.

What is a trade war?

• A conflict involving military forces

• A disagreement over environmental regulations

• A competition between companies in the same industry

• A dispute between countries over trade policies

What happens when tariffs are imposed on imports?

• The quantity of imports increases

• The quality of imports improves

• The cost of imports increases

• The cost of imports decreases

In the Game of Thrones example, what did the Tyrells do to gain an advantage?

• They imposed tariffs on Lannister goods

• They negotiated with the Lannisters

• They stopped trading with the Lannisters

• They subsidized googly eye manufacturing

What is one reason a country might start a trade war?

• To improve diplomatic relations

• To protect its domestic industries

• To increase its military strength

• To reduce its own tariffs

How can a country 'win' a trade war?

• By having more goods to target with tariffs

• By having fewer goods to target with tariffs

• By increasing its imports

• By reducing its exports

What was the Smoot-Hawley Tariff Act?

• A policy that subsidized domestic industries

• A law that imposed steep tariffs on imports

• A law that reduced tariffs on imports

• A treaty that ended a trade war

Which country benefited from the Smoot-Hawley Tariff Act?

• The United States

• Canada

• Soviet Russia

• European countries

How do trade wars affect poorer consumers?

• They experience improved economic conditions

• They face higher prices on basic goods

• They benefit from lower prices

• They have more money to spend on other goods

What types of goods often have higher tariffs in trade wars?

• Luxury items

• Basic necessities like clothing and shoes

• Electronics

• Automobiles

What was one of the reasons President Trump imposed tariffs on Chinese exports?

• To increase Chinese imports

• To reduce the US trade deficit

• To punish Beijing for restricting US investment

• To improve US-China relations