In 2006, the European Union (EU) Threatened to Ban Imports

question 130

Multiple Choice

In 2006, the European Union (EU) threatened to ban imports of long-grain rice because traces of genetically modified rice were found mixed in to commercial supplies. Instead of a ban, suppose the EU placed a tariff on the import of long-grain rice. Which of the following would be an outcome of this tariff?

• A) The EU would gain tariff revenue.
• B) Deadweight loss would decrease.
• C) European rice producers would decrease production.
• D) The price of long-grain rice in the EU would not change.

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