Offer a subsidy to a profitable and successful business, International Economics

Assignment Help:

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.


Related Discussions:- Offer a subsidy to a profitable and successful business

Comparatitve advantage, what are the limitation of comparative advantage?

what are the limitation of comparative advantage?

Explain why east asian countries have done so well, Q. Explain why East Asi...

Q. Explain why East Asian countries have done so well relative to South American countries. Answer: Generally the reasons are less moral hazard less government debt to forei

Excessive current account surpluses, Q. Why do governments prefer to avoid ...

Q. Why do governments prefer to avoid excessive current account surpluses? Or, why are growing domestic claims to foreign wealth ever a problem? Answer: On behalf of a given l

Heckscher-ohlin theory, Q. Countries do not in fact export the goods the H...

Q. Countries do not in fact export the goods the H.O. theory predicts. Discuss. Answer: This statement isn't true that though one may find several cases where it seems to be

Effects of increase in european money supply on dollar, Analyze the effects...

Analyze the effects of an increase in the European money supply on the dollar/euro exchange rate. Answer:  The major points are: A raise in the European money supply will reduc

Could relative wages in the two countries become equal, Q. If trade were t...

Q. If trade were to open up between R and P, where could the world terms of trade locate in the figure above (somewhere on the PC/PF axis)? Could relative wages (w/r) in the two c

Describe the effects of the smoot-hawley tariff, Q. Describe the effects of...

Q. Describe the effects of the Smoot-Hawley tariff imposed by the United States in 1930. Answer: It had a damaging consequence on employment abroad. The foreign response occu

calculate the gross and net national product, Given the following hypothet...

Given the following hypothetical data (in millions of naira): 1.    gross private domestic investment        N59 2.    contributors for social insurance           N8 3.    inter

Immediate demand and cost pressures, Q. "Although the price levels appear t...

Q. "Although the price levels appear to display short-run stickiness in many countries, a change in the money supply creates immediate demand and cost pressures that eventually lea

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd