Question

What is the essential characteristic needed for a country in order for an optimal tariff to...

What is the essential characteristic needed for a country in order for an optimal tariff to be possible?

The country is a small economy

The country is not a large importer of the good

There are no other policies to interfere with the tariff

The country is a large, important importer of the good

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Answer #1

Q. What is the essential characteristic needed for a country in order for an optimal tariff to be possible?

Answer:- The country is a large, important importer of the good.

A large importer country of a good can pass its burden of an import tariff from domestic customers to foreign suppliers which has a monopoly power in export markets or monopsony power in import markets.In this case, a country's tarrifs is said to be optimal or positive, but it is no so large as it can eliminate the entire trade.

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