Donald Trump seems confused about how tariffs work, but that doesn’t mean the rest of us need to be also. It actually is fairly simple, let’s take the case where we are shopping at Temu.

Temu advertises this neat icemaker for $52.62. Trump says he wants to place a 100 percent tariff on the goods we import from China.

This 100 percent tariff (tax) would be applied to the icemaker at the point where it was brought into the country. Let’s say the cost when the icemaker is unloaded at the port is $35.00, the rest of the price is shipping costs and Temu’s profits.

In this story, the 100 percent Trump tax would be $35.00, the price of the good imported. That would mean that $35.00 would be added to the price of the neat icemaker that you wanted to buy. Instead of paying $52.62 for the icemaker you would be paying $87.62.

Now, it is likely that the price will end up being slightly lower than this, but not by much. The whole point of a retailer like Temu is to sell a large volume at a low profit for each item. This means that they don’t have much room to lower the price, before it is not worth making the sale.

So maybe the price they end up charging us in Trump Tariff World would be $87.00 instead of the $87.62 price if the tax was passed in full.

That’s the real world story of Trump’s tariffs. We aren’t sure what story is in Donald Trump’s head.