Which of the following is the best example of a tariff?

• A. A tax imposed by a government on goods imported from another country
• B. A ban on the importation of certain products
• C. A subsidy given to domestic producers to encourage local production
• D. A limit on the quantity of goods that can be imported

Answer: (A)

Verified step by step guidance

1. Step 1: Understand the definition of a tariff. A tariff is a tax imposed by a government on goods imported from another country, which increases the cost of those imported goods.
2. Step 2: Review each option and identify whether it fits the definition of a tariff:
3. - A tax imposed by a government on goods imported from another country (matches the definition of a tariff).
4. - A ban on the importation of certain products (this is an import ban or prohibition, not a tariff).
5. - A subsidy given to domestic producers to encourage local production (this is a subsidy, not a tariff).
6. - A limit on the quantity of goods that can be imported (this is a quota, not a tariff).
7. Step 3: Conclude that the best example of a tariff is the option describing a tax on imported goods, as it directly matches the economic definition of a tariff.