Assume That Country a Provides a Subsidy on Its Exports

question 1

Multiple Choice

Assume that country A provides a subsidy on its exports to country B. Country B is about to impose a countervailing duty (of the same magnitude as the export subsidy) on the imports from country A. Which of the following statements is true in this context?

• A)The exporters in country A gain surplus when the government of country B imposes a countervailing duty.
• B)The import-competing producers in country B are worse off after the imposition of the countervailing duty by the government.
• C)The overall national well-being of country B would be lower when the domestic government imposes a countervailing duty to offset the impact of the export subsidy.
• D)The consumers in country B are better off after the government of country B imposes a countervailing duty.

---

Definitions:

Energy-efficiency

The goal or practice of reducing the amount of energy required to provide products and services, often to conserve resources and reduce environmental impact.

Greenhouse Gases

Gases in the Earth's atmosphere that trap heat, contributing to global warming, including carbon dioxide, methane, and nitrous oxide.

Bioplastic

A type of plastic material derived from renewable biomass sources, such as vegetable fats, oils, corn starch, or microbiota, designed to reduce reliance on fossil fuels.

Renewable Energy

Energy from sources that are naturally replenishing and sustainable over time, such as solar, wind, and hydroelectric power.