Final answer:
The Emergency Tariff of 1921 raised tariffs on foreign goods in the United States, leading to increased prices for these goods and retaliation from other countries, which could hurt American exports and did not necessarily lead to increased American wages or purchasing power.
Step-by-step explanation:
The Emergency Tariff of 1921 was a response to post-World War I economic challenges that American farmers faced, such as falling prices for their goods due to increased European agricultural output. The tariff's intent was to protect American farmers by increasing tariffs on imported goods. This would, in theory, help domestic producers by making foreign goods more expensive and less competitive in the U.S. market.
One economic impact of the Emergency Tariff of 1921 was C. It raised tariffs on foreign goods in the United States and led to other countries retaliating with their own tariffs on American products. This had implications for international trade and the U.S. economy. However, while it was meant to assist American farmers by protecting their market, these new tariffs led to a decrease in the international demand for American goods, negatively impacting the agricultural sector it was intended to help. Moreover, contrary to helping, it did not significantly lead to an increase in American wages or in American purchasing power, nor did it affect interest rates directly.
When tariffs are raised, it often leads to a decrease in the equilibrium quantity of imports and an increase in the equilibrium price of those imported goods. In reverse, a tariff reduction usually causes an increase in the equilibrium quantity of imports and a decrease in the equilibrium price, as it makes foreign goods less expensive and more competitive in the home market.