Question

How does protectionism affect the price of the

protected good in the domestic market?

Short answer

Protectionism affects the price of the protected good in the domestic market through increased prices.

Step-by-step solution

Step 1. Meaning 

Protectionismis a trade policy that allows the government of a country to impose tariffs on foreign goods and services to protect or boost the domestic production of goods and services.

Step 2. Explanation

When government restricts foreign goods' flow into the market, due to the tariffs the domestic market increases the prices of goods & consumer has limited choices there. Free trade increase the choices available to the consumers. Competiton also contributes to lower prices. But this competition is absent in case of protectionism.