When Assessing the Welfare Effect of an Export Subsidy on a

question 15

Multiple Choice

When assessing the welfare effect of an export subsidy on a
Small nation, it can be shown that the subsidy:

• A)increases national welfare.
• B)can be paid for out of increased revenues.
• C)hurts producers and helps consumers.
• D)is just the same as a tariff on imports: it raises domestic price, increases domestic production, and involves the same
• Efficiency and consumption losses.

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Definitions:

Alkaline Earth Metals

Alkaline earth metals are a group of elements in the second column of the periodic table, characterized by their metallic properties and two valence electrons.

Transition Metals

Elements found in the middle of the periodic table that are characterized by their ability to form compounds with variable oxidation states and colored compounds.

Noble Gases

Inert gaseous elements that belong to Group 18 of the periodic table, known for their lack of chemical reactivity.

Halogens

A group of elements found in Group 17 of the periodic table, characterized by their high reactivities and tendencies to form salts with metals.