Question

Suppose that, as part of an international trade agreement, the U.S. government reduces the tariff on imported coffee. Will this affect the supply or the demand for coffee

Answer 1

It would affect the supply of coffee.

Step-by-step explanation:

As a result of the tariff reduction, the import of coffee would increase. As a result, the supply of coffee would increase, shifting the supply curve for coffee to the right.

Please check the attached image for a graph showing increase in supply