Economics · International Trade
What are the primary economic effects of an export bounty given to domestic goods?
Verified Solution4 OptionsUpdated: October 2026👁️1 View
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- 1It forces foreign governments to reduce their import tariffs.
- 2It effectively reduces the price for foreign buyers and incentivizes exports.✓
- 3It increases the cost of production and discourages trade.
- 4It increases domestic prices and reduces foreign exports.
Correct answer
It effectively reduces the price for foreign buyers and incentivizes exports.
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