Question

A country is a leading producer of lumber. They want to increase their

production of lumber. They decide to impose a tariff on the importation
of lumber. What is the likely result of this decision on exports,
domestic consumers, and producers? (1 point)
a tariff will decrease imports and raise prices for domestic
consumers and producers
a tariff will increase imports of lumber and lower prices for domestic
consumers and producers
a tariff will decrease exports of lumber, lower prices for domestic
consumers, and raise prices for foreign consumers
a tariff will increase exports of lumber and lower domestic prices for
consumers and producers

Answer 1

Imposing a tariff on imported lumber is likely to result in decreased imports, and higher prices for domestic consumers, and can be beneficial to domestic producers due to reduced competition from imports.

Step-by-step explanation:

If a country that is a leading producer of lumber decides to impose a tariff on the importation of lumber, the likely result on exports, domestic consumers, and producers is that the tariff will decrease imports and raise prices for domestic consumers, while potentially benefiting domestic producers. When tariffs are imposed, domestic producers may benefit because they face less competition from imports, which can lead to increased sales and potentially more investment in production. However, this benefit to producers comes at a cost to consumers, who will likely see an increase in lumber prices due to the reduced supply of imported lumber and higher costs of domestically produced lumber.

Answer 2

Imposing a tariff on lumber imports will likely lead to decreased imports and higher domestic prices for consumers, while possibly benefiting domestic producers by reducing foreign competition.

Step-by-step explanation:

If a country that is a leading producer of lumber decides to impose a tariff on the importation of lumber, the likely result is that imports will decrease, and domestic prices for both consumers and producers will rise. This is because tariffs act as a trade barrier, making imported lumber more expensive which can potentially reduce the quantity imported. Domestic producers may benefit from reduced competition and could potentially increase their market share within the country, potentially leading to an increase in domestic production. However, this advantage comes at the expense of domestic consumers, who are likely to see higher prices as a result of the tariff. Furthermore, imposing a tariff does not typically lead to an increase in a country's exports of the product on which the tariff has been imposed.