Final answer:
Tariffs benefit domestic manufacturers by protecting them from foreign competition, leading to higher profits and potential job growth within these industries. However, farmers and consumers are disadvantaged as farmers face difficulties selling abroad due to retaliatory tariffs, and consumers experience increased prices. Overall, tariffs can lead to a short-term domestic industry boost but may harm international trade relationships and consumer welfare.
Step-by-step explanation:
The imposition of tariffs can benefit and disadvantage different groups within an economy. A group that would benefit from tariffs includes domestic manufacturers, as tariffs increase the cost of imported goods, making domestically produced items more competitive. This protectionism can lead to increased profits and job creation within these industries.
On the other hand, a group that would be disadvantaged by tariffs are farmers and consumers. Farmers often face retaliatory tariffs on their exports, making it harder to sell their products internationally. Consumers suffer because tariffs on imports lead to higher prices for goods, and the variety of available products can decrease.
Comparatively, the overall economic situation with tariffs might show a short-term boost in domestic manufacturing at the expense of higher consumer prices and decreased export competitiveness. Conversely, a situation with free trade and no tariffs generally leads to lower prices for consumers and greater market access for exporters, although it can also result in domestic industries facing intense foreign competition.