The United States imports shoes from Thailand. When Thailand drops the prices on its shoes, the U. S. reacts by imposing a tariff on Thai shoes. The U. S. has invoked a (n) ?

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Business

Celeste Tucker

17 October, 16:10

The United States imports shoes from Thailand. When Thailand drops the prices on its shoes, the U. S. reacts by imposing a tariff on Thai shoes. The U. S. has invoked a (n) ?

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Answers (1)

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Dillon Floyd · Answer 1

Barrier on imports

Explanation:

Cutting down the prices of the Thai shoes by Thailand will render an increased sale of the shoes in the market of United States. By reducing the prices of the shoes, Thailand has made the purchase of its shoes much more affordable for its consumers, this would lead to an increased demand of their shoes. This would not only increase the imports of United States but will also increase the competition for local shoes industries.

Thus a tariff is imposed to retain the original price of the shoes and maintain the level of Balance of Payment for United States trade and shelter the local industry of shoes in the US from foreign competition.