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Suppose Canada Threatens to Impose a Tariff on German Cars

Question 89

Multiple Choice

Suppose Canada threatens to impose a tariff on German cars if Germany does not remove agricultural subsidies.How will Canada end up


A) better off, no matter how Germany responds
B) better off, if Germany gives in to the threat, and will be no worse off if it doesn't
C) worse off, if Germany doesn't give in to the threat
D) worse off, no matter how Germany responds

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