analysing tariffs

• What is one effect of imposing tariffs on a country's current account?

  It will lead to an improvement in the current account
• How do tariffs affect domestic industries and jobs?

  They strengthen domestic industries and support domestic jobs
• What is the relationship between producer surplus and overall welfare when tariffs are imposed?

  Although producer surplus increases, there is an overall net welfare loss
• What factor may prevent the anticipated improvement from tariffs?

  Retaliation from other countries against the country imposing the tariffs
• What are the potential consequences of imposing tariffs on a country's economy?

  
  

  • Overall net welfare loss
  • Risk of retaliation from other countries