Which government action would interfere with free trade?
(1 point)
Responses
increasing taxes on domestic producers
increasing taxes on domestic producers
charging duty taxes on foreign goods
charging duty taxes on foreign goods
adding a value-added tax to consumer goods
adding a value-added tax to consumer goods
giving contracts to factories in other countries
Charging duty taxes on foreign goods would interfere with free trade. Duty taxes, also known as tariffs, are imposed by a government on imported products. By increasing the cost of these products, tariffs can make them less competitive in the domestic market compared to locally produced goods. This interference can protect domestic industries but also has the potential to provoke retaliatory measures from other countries, possibly leading to trade wars that can further hinder the free flow of goods and services across borders.
Choose a abswer
Charging duty taxes on foreign goods.
The government action that would interfere with free trade is charging duty taxes on foreign goods.
To arrive at this answer, we need to understand what free trade entails. Free trade refers to the ability to exchange goods and services between countries without any restrictions or barriers such as tariffs, quotas, or taxes. It promotes economic growth, reduces prices for consumers, and encourages competition.
Out of the provided options, charging duty taxes on foreign goods is the action that goes against the principles of free trade. When a government imposes duty taxes on imported goods, it increases the cost of those products, making them more expensive for consumers or businesses that rely on imported materials. This act is considered a barrier to free trade as it hampers the ability of foreign producers to compete in the domestic market on an equal footing.
Increasing taxes on domestic producers or adding a value-added tax to consumer goods are not direct interventions that impact free trade. These actions may have consequences on domestic industries or consumer spending, but they do not specifically target foreign goods or impede their entry into the market.
Giving contracts to factories in other countries is not an action that directly interferes with free trade either. It may be a strategic decision based on various factors such as cost, quality, or availability of resources. As long as there are no restrictions on the import or export of goods, outsourcing production to other countries does not necessarily violate the principles of free trade.
Therefore, the government action that would interfere with free trade is charging duty taxes on foreign goods.