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Q. How could the U.S. government justify its decision to offer a subsidy to a profitable and successful business?
Answer: It could indicate that this $10 million pump-priming expenditure results in a profit of $110 million. If Boeing paid a subsidiary income tax of 20% this would net the government $55 million which is in excess of 5 times the original subsidy thus that the decision may be justified not only in terms of benefit/cost considerations however even in terms of pure budgetary terms.
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Q. "The balance of payments is always balanced." Discuss. Answer: True each international transaction automatically enters the balance of payments twice once as a debit and o
how to determine free trade for small country
Q. It is argued that import substitution is a misguided trade policy if the intent is to show long-term economic growth. Illustrate the reasons underlying this argument. Answe
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Q. Discuss the different types of Letters of credit? Types: i. Revocable Letter of credit ii. Irrevocable Letter of credit iii. Deferred payment Letter of credit iv. Confirmed
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What constitutes the basis for trade? What are the gains from trade in terms of production and consumption? Use theories and examples from a country of your choice.
Q. Describe the chain of events leading to exchange rate determination for the following cases: 1. An increase in the U.S money supply 2. An increase in the growth rate of the
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