Question

Imagine that the government of france imposes a tariff on imported wineglasses. (you may assume there was no tariff on wineglasses previously.) which of these consequences would you expect to result from the new tariff?

Answer 1

The French wine producers are adversely affected while the United States wine producers benefit from the United States tariffs. The French government would likely retaliate by imposing tariffs on the United States beverage firms, which would adversely affect their value. The French beverage firms would benefit.