If Reducing Trade Barriers Is Supposed to Improve Consumer Surplus

question 94

Essay

If reducing trade barriers is supposed to improve consumer surplus and reduce deadweight loss, why is it so difficult to reduce trade barriers?

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Definitions:

Learning Curve

The graphical representation of how an increase in learning comes from greater experience or the decrease in marginal costs over time.

Aggressive Pricing Policy

A strategy where a company sets lower prices than its competitors to gain market share and deter competition.

Continuing Cost Reduction

A strategy aimed at consistently lowering costs over time through efficiency improvements and waste reduction.

Premise

A basic assumption or statement that serves as the foundation for a logical argument or reasoning.