Trade of goods between countries is an important international issue. One nation may decide to place tariffs or tax on corn coming to their country. This would make the corn for other countries more expensive. It would protect local corn growers from competition. How might the tariff on corn affect local decision making?

Question

A. Local governments may stop corn production.
B. Local governments may buy more corn from other countries.
C. Local governments may encourage more local corn production.
D. Local governments may discourage more local corn production.

Answer 1

C. Local governments may encourage more local corn production.

When a tariff is imposed on imported corn, it makes foreign corn more expensive, which can protect local corn growers from competition. As a result, local governments may be more inclined to encourage local corn production to support domestic farmers and ensure a stable supply of corn within the country.