Illustrate what is the effective rate of protection

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Reference no: EM1348500

the United States simultaneously limits imports of ethanol for fuel purposes, and provides incentives for the use of ethanol in gasoline, which raise the price of ethanol by about 15 percent relative to what it would be otherwise. We do, however, have free trade in corn, which is fermented and distilled to make ethanol, and acoounts for approximately 55 percent of the cost. Illustrate what is the effective rate of protection on the process of turning corn into ethanol?

Reference no: EM1348500

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