Georgia Assessments for the Certification of Educators GACE Practice Test

If a government implements an import tariff on consumer electronics, what is it most likely trying to accomplish?

1. It is trying to decrease the cost of imported consumer electronics

2. It is trying to discourage domestic companies from producing consumer electronics

3. It is trying to increase competition and lower prices in the consumer electronics industry

4. It is trying to protect its domestic consumer electronics industry from competition

The correct answer is: It is trying to decrease the cost of imported consumer electronics

The correct answer highlights that the implementation of an import tariff on consumer electronics serves the purpose of protecting the domestic consumer electronics industry from external competition. When a government imposes a tariff, it raises the price of imported goods, making them less competitive compared to domestically produced goods. This strategy aims to encourage consumers to purchase locally made products, thereby supporting domestic manufacturers and preserving jobs within the country. The tariff effectively increases the cost of imports, which is why the answer about decreasing costs is not appropriate. Additionally, discouraging domestic companies from producing electronic goods goes against the goals of a tariff, which is to promote domestic production. Lastly, increasing competition and lowering prices contradict the primary function of a tariff, which is to limit foreign competition and stabilize or enhance domestic industry.