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Is there such a thing as an optimal export subsidy? a) Yes. If a country is large enough it is the export counterpart of the
Is there such a thing as an optimal export subsidy?
a) Yes. If a country is large enough it is the export counterpart of the optimal tariff
b) Yes. The export subsidy increases the export price, increasing the terms of trade px/pm
c) No. Export subsidies are too expensive to implement
d) No. An export subsidy will increase exports, perhaps lowering the terms of trade
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