Trade Creation Tends to More Than Offset Trade Diversion for a Home

question 26

True/False

Trade creation tends to more than offset trade diversion for a home country forming a customs union with partner countries when: (1) the tariff rate in the home country is high prior to the formation of the customs union; (2) there are a large number of countries forming the customs union.

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Definitions:

Relative Frequency

The proportion of times a certain value or category appears in a dataset relative to the total number of observations.

Histogram

A graphical representation of the distribution of numerical data, typically shown as bars indicating the frequency of data points within specified intervals.

Frequency

The number of times an event or occurrence takes place within a specified period or dataset.

Symmetric

Refers to a situation where a distribution or pattern shows equality or uniformity across a central point or axis.