Tariff and Nontariff Barriers

Tariff and Nontariff Barriers - Global Financing 1 Running...

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Global Financing 1 Running Head: Global Financing Global Financing and Exchange Rate Mechanisms MGT 448 June 13, 2011
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Global Financing 2 It is important for exporters to measure the overall restrictiveness of a country’s international trade policies. Many organizations estimate the effects of trade policies to see if they can reduce any trade barriers. Organizations understand that tariff and non- tariff barriers can affect their export business. In most countries, the governments impose these trade barriers and the general purpose behind them is to limit the imports of some specific product. By imposing trade barriers, the governments are looking to achieve some or all of these economic targets (King, 2009). Tariff and Global Financing Tariff is a taxation imposed on goods and services imported into a country, also known as a duty tax. Governments generally impose tariffs to raise revenue and protect domestic industries from foreign competition caused by factors like government subsidies, or lower priced goods and services. In most cases the tax is collected at the moment some shipment arrives at ports (Investopedia 2011). Governments normally force tariffs to protect local industries and to raise their revenues, although many economists have debated against it. Countries commonly use tariffs and other barriers to deter the importation of foreign-produced goods. Such trade policies affect economic activity and economic well-being not only in the country enacting these policies but in other countries as well (Coughlin, 2010). The goal of a tariff is to secure the domestic product of a given nation from cheaper goods which are imported from nations that have a larger producing capacity. To keep the domestic gains strong the government installs tariff on the imported goods which levy the prices This act by the government creates a security blanket for the limited product of certain import goods .   Tariff also helps to balance the prices in a country.
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Global Financing 3 Exporters should conduct business with countries with minimum tariffs because
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Tariff and Nontariff Barriers - Global Financing 1 Running...

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