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The federal government enacts new tariffs and quotas on all imports.

The federal government enacts new tariffs and quotas on all imports.

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Answer #1

This action will have cascading effect on the US economy in the following ways:-

  1. Lead to high pricing of the products as imports are reduced.
  2. Will lead to fewer choices for goods in the market.
  3. Will lead to low competition in the market, resulting in low quality products.
  4. Will lead to inflation, if the demand supply equibrium is disturbed due to supply side constraints.
  5. Will increase employement, as more local production will try to occupy the available space.
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