Q9 of 37 Page 4

What would happen if the government puts a heavy tax on import on Chinese toys?

If the government heavy tax on import of Chinese goods:

1. Their price will go up.


2. Their demand will decrease, and they will eventually lose the market in India.


3. Indian toys will become relatively cheaper, and their demand will rise.


4. It will be beneficial to the Indian toymakers as their profits will increase.


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