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What is a tariff?
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A tariff is a tax imposed by a government on imported goods or services to protect domestic industries and generate revenue.
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What are the two main types of tariffs?
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The two main types of tariffs are specific tariffs and ad valorem tariffs.
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What is a specific tariff?
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A specific tariff is a fixed fee imposed on one unit of an imported good.
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What is an ad valorem tariff?
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An ad valorem tariff is a tax levied as a percentage of the value of the imported good.
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How did tariffs historically protect domestic industries?
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Historically, tariffs protected domestic industries by making imported goods more expensive, thereby encouraging consumers to buy home-produced products.
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What was the Smoot-Hawley Tariff Act of 1930?
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The Smoot-Hawley Tariff Act was a U.S. law that raised tariffs on over 20,000 imported goods to record levels.
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What impact did the Smoot-Hawley Tariff Act have on the global economy?
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The Smoot-Hawley Tariff Act is believed to have worsened the Great Depression by reducing international trade.
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Can you name a recent tariff imposed by the United States?
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In 2018, the United States implemented tariffs on steel and aluminum imports, citing national security concerns.
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What is a protective tariff?
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A protective tariff is designed to shield domestic industries from foreign competition by raising the price of imported goods.
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What is a revenue tariff?
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A revenue tariff is primarily intended to generate income for the government rather than to protect domestic industries.
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What does the term "Most Favored Nation" status refer to?
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"Most Favored Nation" status refers to a level of trade advantage that a country extends to another, including the lowest possible tariffs.
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Why might a country impose tariffs on environmental grounds?
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A country might impose tariffs on environmental grounds to discourage imports of goods that have a high carbon footprint or are otherwise environmentally damaging.
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Define a quota as it relates to tariffs.
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A quota is a limit on the quantity of a good that can be imported, often used alongside tariffs to control trade volumes.
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What is the World Trade Organization's stance on tariffs?
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The World Trade Organization generally advocates for reducing tariffs to promote free trade among nations.
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How can tariffs impact consumers?
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Tariffs can lead to higher prices for consumers as the added tax on imports is often passed down to buyers.
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What was one effect of the tariffs imposed by the U.S. on China in recent years?
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U.S. tariffs on Chinese goods led to a trade war, resulting in retaliatory tariffs and increased costs for businesses and consumers.
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What is a retaliatory tariff?
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A retaliatory tariff is a tariff imposed by a country in response to tariffs levied by another country.
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How do tariffs affect domestic employment?
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Tariffs can protect jobs in industries that face foreign competition, but may also lead to job losses in industries that rely on imported components.
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What is trade liberalization?
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Trade liberalization is the reduction or elimination of tariff barriers to encourage free trade among countries.
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How did tariffs contribute to the start of the American Revolutionary War?
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Tariffs and taxes imposed by the British on the American colonies without representation led to economic grievances that fueled the desire for independence.
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