This article explains the concept of tariffs, their potential impact on prices and the economy, especially in the context of President Trump's trade policies. It discusses how tariffs can increase costs for consumers, impact lower-income households the most, and influence the automotive industry. The article also considers the political and economic debates surrounding the effectiveness of tariffs in boosting domestic manufacturing and overall economic health, highlighting that their true impact will take time to fully assess.

Understanding Tariffs and Their Impact on Prices and the Economy

Tariffs are percentage-based charges on imports, meant to increase their cost compared to domestic products, paid by whoever brings them into the country (and often, but not necessarily, passed on to consumers). In President Trump’s plan, nearly all imports into the United States will be charged at least a 10 percent tariff. Meanwhile consumption taxes — like a sales or excise tax, for example — are imposed on the cost of the thing being sold and are paid directly by the consumer. For instance, a value-added tax is a consumption tax levied on the value added to a product on every stage of production and distribution, regardless of where it came from. It lands with the person who buys the good in a store, not the businesses who helped bring it to the shelves.

Related: Analysis: How worried should you be about the stock market? Here are three things to consider.

But as many businesses are likely to raise prices to pay for tariffs, some economists have said that the Trump-era tariffs are a type of taxation that will ultimately hike costs for Americans on many types of goods, including products made in the United States with imported materials. Call it a tax or a tariff, you’ll be paying it either way.

“It is in part a consumption tax,” said Adam Guren, a professor of economics at Boston University. “The evidence shows that for every dollar increase in tariffs, prices go up 94 cents.”

Broadly speaking, lower-income residents tend to spend a higher share of their income on food and other everyday needs and often rely on less-expensive imported products. Many of these items come from Southeast Asian countries that have been hit with some of the highest tariffs, such as Vietnam, Laos, and Cambodia, which will make those goods more expensive. Economists also expect the price of some domestic products will also rise now that they are no longer constrained by competition from imported items.

The lower a person’s income, the greater the share of that person’s income that will be eaten up by paying more for pretty much everything. And shelling out more for everyday items will make it more difficult to save for larger expenses, be it to buy a house or cover an unexpected medical bill or go on vacation.

If you’re not particularly close to retirement, and you can stomach it, probably the best advice is to do nothing. Markets fall and markets rise, and history would suggest that the losses of the past week will be gained back eventually. If you sell your stocks now, you simply bake in those losses, and trying to time the rebound is a tricky proposition. You could wind up falling behind for good. So while it might be gut-churning, try and sit tight.

Now, if you’re nearing retirement, or recently retired, it may be a different story. The last few years of your working life and the first few years after it are a particularly perilous time when it comes to making the most of retirement savings, financial advisors say. If that’s you, hopefully you’ve already shifted a good bit of your portfolio to lower-risk holdings. If you’re not comfortable with where you sit, the best move is to call a professional, and talk through your options. You won’t be the only one.

The answer is that it’s going to take time to know how the 25 percent tariff on cars will affect consumers. For one thing, vehicles currently on car lots were sold to dealers before the tariffs were announced. It’ll take time, probably weeks, to sell all of them, and the amount of unsold inventory varies from brand to brand. There’s maybe a month’s worth of Toyotas on lots nationwide, but several months of Fords, for instance. In addition, inventory varies from dealer to dealer so some will run out quicker than others.

Cars made in Europe or Asia will be subject to the full 25 percent tariff. These include major Japanese and German brands, as well as some Buick and Lincoln cars that are made in China. But for cars covered under the US-Canada-Mexico trade agreement, the 25 percent tariff will apply only to components that are made outside the United States. So the non-US parts in, say, a Mexican-made Chevy Silverado will cost more. And that will, of course, boost the overall price of the vehicle, though perhaps not as much as a car that is fully imported from Asia or Europe.

And since the automotive sector is intensely competitive, none of the companies want to raise their prices, certainly not by 25 percent. They’ll probably eat some of the tariffs, but they’re bound to pass along some of the price hikes to customers, too.

Yeah, it’s all very complicated. The best available advice is to buy now, or you’ll pay later.

It may be hard for members of the American public to come to a consensus about whether the tariffs “worked” or not, or whether whatever economic disturbance they cause was justified by the results. One of the reasons is our wide ideological divisions, but another factor is the fact that these tariffs are so broad and sudden that it might be hard to measure which are working and which aren’t.

To understand the Trump administration’s perspective, we can evaluate the statements of the president and his advisers. In a public fact sheet about the tariff moves, the administration cited many economic trends it hopes to reverse. For instance, the decades-long decline in the US share of global manufacturing. If more people work in manufacturing here, and the tariffs prompt businesses to build new factories in the United States, that decline could slow or even turn around, which would probably be seen as good news by the Trump administration. There are other useful statistics on US trade international trade balances with countries that you could also look at, many of them available online from the US Census.

Ultimately, the big question will be the broader effect on the economy. If the stock market doesn’t recover for years, if overall employment doesn’t rise, or if inflation becomes uncontrollable, it would be harder to make the case that tariffs worked. If the economy resumes humming along, however, tariffs will likely have been at least a partial win.

Hiawatha Bray, Katie Johnston, Tim Logan, Diti Kohli and Andrew Rosen of the Globe Staff contributed to this report.