2) Whose interests should be the paramount concern of government trade policy- t

Question

2) Whose interests should be the paramount concern of government trade policy- the interests producers (businesses and their employees) or those of consumers? trade policy should business be pressuring government to adopt? 4) You are an employee ofa U.S. firm that produces personal computers in Thailand and then exports them to the U.S and other countries for sale. The personal computers were originally produced in Thailand to take advantage of relatively low labor costs and a skilled workforce. Other possible locations considered at the time were Malaysia and Hong Kong. The U.S. government decides to impose punitive 100 percent ad valorem tariffs on imports of computers from Thailand to punish the country for administrative trade barriers that restrict U.S. exports Thailand. How should your firm respond? What does this tell you about the use of targeted tra barriers?

Explanation / Answer

Ans

A Those of consumers because tgey form majority of population

B New trade theory is more appropriate and it's conclusions should be favoured

C My firm will try to locate in other low cost locations lije Malaysia and Thailand. This shows targeted trade barriers can distort trade favoring some countries and putting some to disadvantage

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