The US puts a 25\% tariff on Chinese steel to protect jobs in the US steel industry. Under which condition would this policy be most effective?

The price elasticity of demand for Chinese steel is -2.5 .

The price elasticity of demand for Chinese steel is -0.5 .

The price elasticity of supply for Chinese steel is 2.5 .

The price elasticity of supply for Chinese steel is zero.

Economics

IGCSE&ALevel

CAIE

Exam No：0455_m25_qp_12 Year：2025 Question No：28

Answer:

6.2.1 definition of globalisation

6.2.2 role of multinational companies (MNCs) ：MNCs and the costs and benefits to their host and home countries.

6.2.3 the benefits of free trade：The benefits for consumers, producers and the economy in a variety of countries.

6.2.4 methods of protection：Tariffs, import quotas, subsidies and embargoes.

6.2.5 reasons for protection：Including infant industry, declining industry, strategic industry and avoidance of dumping.

6.2.6 consequences of protection：Effectiveness of protection and its impact on the home country and its trading partners