An Export Subsidy Imposed by a Large Country Can Be

question 48

Multiple Choice

An export subsidy imposed by a large country can be more damaging to national welfare than an export subsidy imposed by a small country because:

• A)the production effect is necessarily larger for the large country.
• B)the consumption effect is necessarily larger for the large country.
• C)the terms of trade worsen for the large country but not for the small country.
• D)the net national gains of the large country are overshadowed by the net welfare loss of the world.

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Definitions:

μ

Symbol representing the mean of a population in statistics.

≠ Symbol

A mathematical symbol denoting inequality, specifically that two values are not equal.

Null Hypothesis

A statistical premise asserting the absence of a relationship or impact between variables, tested to determine if an observed association is likely due to chance.

Directional

Refers to hypotheses in research that predict not only the existence of a relationship between variables but the direction of that relationship as well.