For advanced countries such as the United States tariffs on imported raw materials tend to be
Options:
| a. equal to tariffs on imported manufactured goods b. lower than tariffs on imported manufactured goods c. higher than tariffs on imported manufactured goods d. the highest of all tariffs |
The Correct Answer Is:
b. lower than tariffs on imported manufactured goods
The correct answer is b. lower than tariffs on imported manufactured goods.
Explanation:
In advanced countries like the United States, tariffs on imported raw materials are typically lower than tariffs on imported manufactured goods. This is because advanced economies recognize the importance of raw materials in their own production processes.
By keeping tariffs on raw materials low, these countries aim to promote domestic manufacturing and ensure a steady and affordable supply of inputs for their industries.
Lower tariffs on raw materials encourage businesses to source the necessary resources internationally, which can lead to cost savings and increased competitiveness. This benefits both the domestic industries and consumers, as it can result in lower prices for finished goods.
It also promotes specialization, allowing each country to focus on producing the goods or services where it has a comparative advantage.
In conclusion, advanced countries, like the United States, tariffs on imported raw materials are typically lower than those on manufactured goods. This policy supports domestic manufacturing, ensures a steady supply of affordable inputs, and promotes international sourcing for cost savings and increased competitiveness.
Explanation of why other answers are not correct:
a. Equal to tariffs on imported manufactured goods:
Setting tariffs on raw materials equal to those on manufactured goods would hinder the production process in advanced countries. Raw materials are the fundamental building blocks of any manufacturing process.
By imposing equal tariffs, it would significantly increase the cost of production, making domestically produced goods less competitive in both domestic and international markets. This scenario would discourage domestic production and potentially lead to a decline in economic growth.
c. Higher than tariffs on imported manufactured goods:
This scenario is counterintuitive for advanced countries. Higher tariffs on raw materials would significantly raise the cost of production for domestic industries. This would not only make domestically produced goods more expensive for consumers, but it could also lead to reduced competitiveness in the global market.
It could also result in a decrease in the overall output of the manufacturing sector, which is a crucial component of most advanced economies.
d. The highest of all tariffs:
This would be an extreme and unrealistic policy approach for any advanced country. If a country were to impose the highest tariffs on raw materials, it would effectively shut off its own access to essential resources from the global market.
This would severely disrupt the functioning of its industries and likely lead to shortages of critical inputs. Such a policy would not only escalate production costs for domestic industries but would also trigger trade disputes and potentially damage international relations.
In summary, it is not in the economic interest of advanced countries to set high tariffs on imported raw materials. Doing so would impede the production process, increase costs for both producers and consumers, and hinder competitiveness in the global market.
Therefore, lower tariffs on raw materials are favored to ensure a smooth and cost-effective supply chain for domestic industries. This policy approach ultimately supports economic growth and stability in advanced nations.
Related Posts
- Price policy mainly benefits - October 1, 2022
- The three major types of ethical issues include except? - October 1, 2022
- The shortest distance between any two dots of the same color is called ………………. - October 1, 2022