Question

In 2 or 3 sentences, give two disadvantages of a tariff.

Answer 1

One of the disadvantages of tariffs is that it implements high tax on imports,  leading to the decrease in competition of foreign products, consequently leading to higher prices on imports. Next, it would hinder free trade and spark trade wars among producers and importers, leading to possible economic decline.

Answer 2

A tariff is a tax imposed on products and services; this is used to control trade and one of its major disadvantages is that they rise the prices of imports giving way to a decrease in consumer surplus. What´s more, a tariff discourage competition making local industries less efficient, leading to decreases in product quality. Moreover, high tariffs may result in trade wars between nations due to the fact, exporting countries counter with their own tariffs on imported products.