Question

A tax on automobiles imported into the United States that raises prices on imported vehicles to make the price of cars produced in the United States more competitive is a(n) ________; a tax on all oil imported into the United States, which is implemented to raise money for the U.S. government, is a(n) ________ tariff.

Answer 1

Answer:

A tax on automobiles imported into the United States that raises prices on imported vehicles to make the price of cars produced in the United States more competitive is protective tariff; a tax on all oil imported into the United States, which is implemented to raise money for the U.S. government, is Revenue tariff.

Explanation:

Protective tariff:  

• Protective tariff is understood by the tariffs that are enacted by the government with a motive to promote and protect the domestic industries.

• In protective tariff, government allocates higher tax rate for the products that are imported from foreign countries when the same product is produced in the country.

• This helps the domestic industries to compete with the foreign industries.

• Government also can provide protection to domestic industry as well as collect more revenue due to this tariff.

Revenue tariff:

• Revenue tariff is the tariff imposed with a motive to collect revenue by the government.

• By imposing revenue on imports and exports, government collects revenue which can be used in development, service and defense of the country.