A car dealer, buys cars to sell, using cash supply that he expects to make 30% profit on (for example). Now that the cars suddenly require 25% more of his cash supply, he will still want to make the same percentage profit. So that car is going to cost you Original price+ 25% tariff +(30% of the 25% tariff).
TLDR The price of the car goes up MORE than just 25%. The dealer pays upfront, so he wants profit on however much he needs to pay. He’s not going to just charitably advance an extra 25%, which he probably borrows from an overdraft and has to pay fees/interest on, for free.
These numbers are hypothetical.
make logic out of what you said
A car dealer, buys cars to sell, using cash supply that he expects to make 30% profit on (for example). Now that the cars suddenly require 25% more of his cash supply, he will still want to make the same percentage profit. So that car is going to cost you Original price+ 25% tariff +(30% of the 25% tariff). TLDR The price of the car goes up MORE than just 25%. The dealer pays upfront, so he wants profit on however much he needs to pay. He’s not going to just charitably advance an extra 25%, which he probably borrows from an overdraft and has to pay fees/interest on, for free. These numbers are hypothetical.