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Suppose Germany, a large country, imposes a tariff on tuna imports. Before the tariff, all the countries in the world are engaged in free trade in tuna. Explain why.
(1). The German consumers pay a higher price for tuna.
(2). The German producers receive a higher price for tuna.
(3). The world price of tuna increases.
(4). The tariff makes Vietnam, a tuna exporting country, worse off.
(5). Vietnamese tuna consumers suffer because of the tariff.
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Answers: 3
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Suppose Germany, a large country, imposes a tariff on tuna imports. Before the tariff, all the count...
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