Final answer:
The correct answer is B. tariff, which is a tax on goods imported into a country. A reduction in tariffs on imported flat screen televisions would likely lead to lower prices and increased demand, resulting in a higher equilibrium quantity sold.
Step-by-step explanation:
A tariff is a tax levied on a good imported into a country. Therefore, the correct answer to the question, "A(n) ______ is a tax levied on a good imported into a country," is B. tariff.
Continuing with the example provided, if the U.S. government cuts the tariff on imported flat screen televisions, we can analyze the potential impact using a four-step analysis:
- Since the tariff is reduced, the cost to import flat screen televisions will decrease.
- Lower import costs lead to a decrease in the market price for these televisions.
- As the price decreases, demand for flat screen TVs is likely to increase, as they become more affordable to consumers.
- Finally, the increased demand will lead to a higher equilibrium quantity of flat screen TVs sold.
Overall, the reduction in tariffs results in lower prices and higher quantities of flat screen TVs in the market.