Economics · International Trade
The Metzler Paradox describes the theoretical possibility that imposing an import tariff may result in:
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1No change in terms of trade
- 2Negative protection to the import-competing industry (a fall in domestic price of imported good)✓
- 3Positive protection to the import-competing domestic industry
- 4An increase in the relative domestic price of the imported good
Correct answer
Negative protection to the import-competing industry (a fall in domestic price of imported good)
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