Question

Which of the following were effects of the Smoot-Hawley Tariff? Select all that apply.

1.) Taxes on foreign imports were reduced.
2.) Foreign governments refused to buy American exports.
3.) The depression worsened as more companies were forced out of business.

Answer 1

Answer: Both 2&3

2-Foreign governments refused to buy american exports

3-The depression worsened as more companies were forced out of business

Answer 2

The effects of 'Smoot-Hawley Tariff Act' was 'Foreign governments refused to buy American exports', and 'the depression worsened as more companies were forced out of the businesses'.

Option: 2 and 3

Explanation:

The 'Smoot-Hawley Tariff Act' was introduced to protect the American businesses, markets and farmers from loss and the foreign competition. But now the Act is blamed widely to worse the Great Depression as more companies were forced to leave their business. The act increases a tariff on the 'foreign imports' to the US by around 20%. As a result of which, around 25 countries at the least increase their own tariffs on 'American goods' for which the foreign government refused to buy American exports as the Great depression had made them economically challenged i.e., no one had money to buy goods except the wealthy people.