Cascading Chain of Events; Donald Trump's 25% Tariff on Canadian Goods

Trump's Tariff Announcement

Direct Impact:

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U.S consumers face higher prices for Canadian imports Canadian exports lose competitiveness in the U.S market

Affected Entities

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U.S Manufacturers relying on Canadian inputs.Canadian companies dependent on U.S Trade

Canada's Retaliation

Direct Impact

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Canadian Tariffs increase prices of U.S. imports U.S farmers and exporters face reduced demand from Canada

Affected Entities

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Canadian consumers pay more for essential goods U.S businesses lose market access to their largest trading partner

COnsumer Costs Rise

Direct Impact

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Tariffs lead to inflation as businesses increase prices to offset costs Lower-income households struggle with higher experience

Affected Entities

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U.S and Canadian Households face reduced purchasing power Retailers experience shifts in consumer behaviour, with demand for local substitutes

Government Intervention and Trade Tensions

Direct Impact

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Governments engage in prolonged negotiations to de-escalate trade conflicts Both countries allocate resources to subsidize affected industries

Affected Allies

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taxpayers bear the cost of government subsidies Political relations between the U.S and Canada worsen