8. Use your knowledge about trade policy to evaluate each of the following statements: a. An excellent

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8. Use your knowledge about trade policy to evaluate each of the following statements:

a. “An excellent way to reduce unemployment is to enact tariffs on imported goods.”

b. “Tariffs have a more negative effect on welfare in large countries than in small countries.”

c. “Automobile manufacturing jobs are heading to Mexico because wages are so much lower there than they are in the United States. As a result, we should implement tariffs on automobiles equal to the difference between U.S. and Mexican wage rates.”

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International Finance Theory And Policy

ISBN: 9781292019550

10th Edition

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

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