Question

Introducing a tariff on vitamin Z would:

A. reduce exports of vitamin Z.
B. increase American consumption of domestically produced vitamin Z.
C. increase total American consumption of vitamin Z.
D. decrease domestic production of vitamin Z.

Answer 1

Introducing a tariff on vitamin Z would likely reduce exports, increase American consumption of domestic vitamin Z, and may or may not impact total American consumption. The tariff is not directly related to domestic production.

Step-by-step explanation:

A tariff is a tax imposed on imported goods that aims to protect domestic industries and generate revenue for the government. In the case of introducing a tariff on vitamin Z, it would likely have the following effects:

1. Option A: It would reduce exports of vitamin Z as the tariff would make it more expensive for foreign buyers to purchase.
2. Option B: It would increase American consumption of domestically produced vitamin Z as the higher price of imported vitamin Z would make domestically produced vitamin Z relatively more competitive.
3. Option C: It may or may not increase total American consumption of vitamin Z depending on the overall demand for the product and the price elasticity of demand.
4. Option D: It is not directly related to domestic production of vitamin Z as the tariff primarily affects imports.