Hello, Regarding the Tariff, we all know what does it do. After doing a Regressi
ID: 1227848 • Letter: H
Question
Hello,
Regarding the Tariff, we all know what does it do.
After doing a Regression analysis upon selling the product in Atollia, the results shows that increase in tariff will lead to decrease in the average demand.
Question:
The members of the Board of the product are scheduled to meet with the Trade Minister of Industria. The Board is interested in convincing the Government of Industria to establish closer economic links with Atollia.
Based on the regression results, what can we tell the Trade Minister about the impact of the tariff?
Please and thank you!
Explanation / Answer
The board should go the the trade minister and put forward the following points.
1. Tariif is the addition to cost of the commodity when it is sold in another country. When tariff is imposed in Atolia, the cost of the product for the atolians and therefore the average demand for the product will fall.
2. Due to the fall in demand, the company might suffer losses.
3.Also, tariff acts a barrier in the free trade. A high rate of traiff may also distort the trade relations between two coutries.
3. Therefore, Industria and Atollia should maintain a good relationship and there should be no hindrance to international trade, so that both countries can prosper.
Related Questions
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.