Question

To protect its domestic automotive industry, the United States enacts a(n) ________ by taxing imported automobiles to make the price of U.S.-produced cars more competitive; while also enacting a(n) ________ by taxing imported oil for the purpose of raising money for the U.S. government.

Answer 1

The U.S enacts a protective tariff by taxing imported automobiles in order to protect domestic automotive industry; while also enacting a revenue tariff by taxing imported oil for the purpose of generating money for the U.S government.

What are Protective and Revenue Tariffs?

Protective tariff, as the name implies, are enacted in order to protect a domestic industry by making imported goods cost more than similar goods produced locally.

Revenue tariff however isn't aimed at restricting import but with the sole aim of generating revenue for the government.

Therefore, the U.S enacts a protective tariff by taxing imported automobiles in order to protect domestic automotive industry; while also enacting a revenue tariff by taxing imported oil for the purpose of generating money for the U.S government.

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