In 2006, the European Union (EU) threatened to ban imports of long-grain rice because traces of genetically modified rice were found mixed in to commercial supplies. Instead of a ban, suppose the EU placed a tariff on the import of long-grain rice.
Which of the following would be an outcome of this tariff? A) The EU would gain tariff revenue.
B) Deadweight loss would decrease.
C) European rice producers would decrease production.
D) The price of long-grain rice in the EU would not change.
Question 2
Over its history, Spain has loaned more money abroad than foreigners have lent to it. Spain is a
A) net lender.
B) net borrower.
C) creditor nation.
D) debtor nation.
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