Final answer:
A tariff is indeed an example of trade protectionism, which the United States used prior to NAFTA to protect its auto industry and farmers from foreign competition. The adoption of NAFTA marked a shift toward free trade for the US.The correct option is 1)True.
Step-by-step explanation:
Prior to the North American Free Trade Agreement (NAFTA), the United States did indeed implement various tariffs to protect its auto industry and farmers against foreign competition. A tariff is a tax placed on goods imported from other countries, and it serves various purposes, such as protecting sensitive local industries, providing safeguards for humanitarian reasons, and preventing dumping, which is the selling of goods below market value to undermine local businesses.
Tariffs are an example of trade protectionism, a policy aimed at restricting imports to shield domestic industries from foreign competition. There are different forms of protectionist policies, including tariffs, import quotas, and non-tariff barriers. Within the United States, shifts between protectionist and free-trade approaches have been seen historically, with NAFTA representing a significant move toward free trade by removing many trade barriers and transaction costs among the US, Mexico, and Canada.
This shift from protectionism to free trade can significantly impact industries and jobs. In the context of NAFTA, while some jobs were lost in industries such as textile/apparel due to factories moving to countries with lower wages, others were created or relocated to the US, as was seen with Cummins diesel engines.
To answer the student's question directly: 1) True, a tariff is an example of trade protectionism.