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I Is a Country a Small or Large Country If

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I. Is a country a small or large country if it faces a perfectly price elastic foreign export supply curve?
II. What is the optimal tariff for a country facing a perfectly price elastic foreign export supply curve?
III. If the foreign export supply is less than perfectly price elastic, will the optimal tariff increase or decrease as the price elasticity of demand increases?
IV. What happens to the country's welfare if it applies a tariff higher than the optimal tariff?


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