What can be a consequence of high tariffs?

Prepare for your UCF GEB3375 Intro to International Business Exam 1. Utilize flashcards and multiple choice questions with explanations to ace your test. Get fully equipped!

High tariffs are taxes imposed on imported goods, making them more expensive in the domestic market. This increased cost typically leads to higher import prices, which can reduce consumer choice. When tariffs are applied, consumers may find that foreign products—previously available at competitive prices—are now less accessible or too costly. As a result, consumers may have to rely more on domestic goods, which might not offer the same variety or quality as international options. This scenario can ultimately restrict the range of products available for purchase, leaving consumers with fewer choices and potentially higher prices for the remaining domestic options.

Options related to reducing domestic product prices or enhancing international relationships don't align with the typical economic outcomes of imposing high tariffs. Instead, tariffs tend to make imported goods more expensive, thereby limiting choices rather than expanding them. Additionally, while tariffs may sometimes protect domestic employment by encouraging consumers to buy local products, this can vary based on industry and market conditions and does not universally lead to global employment increases.

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