Question

Which statement BEST explains why a tariff is considered a trade restriction?

Answer 1

The correct answer is: "tariffs reduce imports"

A tariff is a tax on imported products set by a goverment, which makes products from foreign producers relatively more expensive so that they cannot compete in equal conditions with domestic products.

If the price of foreign products increases, the domestic demand will switch to cheaper domestic substitutes. The demand for imports will decrease and the amounts imported will be reduced, this is why tariffs are considered trade barriers.

Answer 2

Assuming that this is referring to the same list of options that was posted before with this question, the correct response would be that tariffs make imports more "costly," since this discourages the exporting country in question.