=+10. Suppose that Country X subsidizes its exports and Country Y imposes a countervailing tariff that offsets

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=+10. Suppose that Country X subsidizes its exports and Country Y imposes a “countervailing” tariff that offsets the subsidy’s effect, so that in the end, relative prices in Country Y are unchanged. What happens to the terms of trade? What about welfare in the two

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International Economics

ISBN: 9780132146654

9th Edition

Authors: Paul R. Krugman, Maurice Obstfeld, Marc Melitz

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