Regulate Trade
Definition
To regulate trade means that the government sets rules for how business is conducted across borders. These rules can include tariffs on imported goods, quotas on certain products, and standards for safety and quality.
Analogy
Regulating trade is like being a referee at a soccer game. The referee sets the rules for fair play (trade policies), gives penalties when players break those rules (tariffs), and ensures everyone has an equal chance at winning the game (fair competition).
Related terms
Tariff: A tax imposed by a government on goods imported from another country.
Quota: A limit set by a government on the quantity of a product that may be imported during a specific period.
Trade Agreement: An agreement between two or more countries to reduce barriers to trade, such as tariffs and quotas.
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