If a Foreign Country Imposes a Voluntary Export Restraint, Then

question 162

Multiple Choice

If a foreign country imposes a voluntary export restraint, then the:

• A) consumer surplus will be lower than would be so if the home country imposes a tariff.
• B) producer surplus will be lower than would be so if the home country imposes a tariff.
• C) foreign country will capture the area of government revenue collected with an equivalent tariff.
• D) deadweight loss is smaller than would be so if the home country imposes a tariff.

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Definitions:

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