Transcript Pros & Cons of Tariffs

International Trade: Key Terms
Define the following:
International TradeGoodsImportExportTariffN.A.F.T.A.G.A.T.T.-
International Trade: Key Terms
• International
Trade• Goods• Import• Export• Tariff• N.A.F.T.A.• G.A.T.T.-
• trade between 2 or more countries
• Products: things you make, harvest,
mine, or grow for $
• goods being brought into a country
• goods being shipped out of a country
• a tax on foreign imported goods
• (North American Free Trade Agreement)
No tariffs between U.S., Mexico, &
Canada
• (General Agreement on Tariffs & Trade)
World version of NAFTA. Not in effect.
Pros & Cons of Tariffs
A tariff places a tax on foreign imported goods
brought into the U.S. making them more expensive
Tariffs help American manufacturers and workers by
protecting them from foreign competition
Also, raise $ for the government.
Tariffs hurt American consumers who now have to pay
more for the products that they wish to purchase.
Can cause trade & business to slow down due to an
increase in prices.
An example of how a tariff works
• Japan’s Toyota Camry costs $25,000
• U.S.’s Ford Taurus costs $27,000
• Which car are you buying?
• Add a tariff of $5,000 to the Toyota.
• Which car are you buying now?
• What could Ford do with the price of the Taurus if
there was a tariff on the Camry?
Explain if President Obama should
consider using tariffs on other countries’
products as a way to get Americans to
buy American products and help create
American jobs?