Demand-supply graph of trade-diverting customs union

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Jacob Viner originally envisioned a situation where, in the demand/supply graph of a trade-diverting customs union, the demand cureve was vertical and all supply curves (including the supply curve of domestic producers) were horizontal. In this situation, could the trade-diverting customs union ever enhance the home country's (country A's) welfare? Explain.

Reference no: EM13860595

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