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Assume that a large country produces and exports bananas. The world price of bananas is $1 per unit. If the country places an export tariff
Assume that a large country produces and exports bananas. The world price of bananas is $1 per unit. If the country places an export tariff of $0.50 per unit of bananas exported, this will cause:
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an increase in the world price of bananas that is larger than $0.50.
an increase in the world price of bananas that is smaller than $0.50.
a decrease in the world price of bananas that is smaller than $0.50.
a decrease in the world price of bananas that is larger than $0.50.
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