prubdEONAP0A8001000000315c8400700008ct-hughes-0007&kickem;, 1521352685877 0AAAO
ID: 350278 • Letter: P
Question
prubdEONAP0A8001000000315c8400700008ct-hughes-0007&kickem;, 1521352685877 0AAAO Aa Aa 4. Policy response to dumping Suppose the price of coated paper in China is $850 per ton. China exports coated paper to the United States at $650 per ton. The Chinese government does not subsidize domestic producers of paper. Assume that China is the only exporter of coated paper to the United States and that Chinese producers of coated paper act as one firm. Which of the following policies could the United States apply to China under the rules of the World Trade Organization (WTO)? Check all that apply. A countervailing duty An antidumping duty A safeguard tariff An export subsidy to U.S. producers of coated paper An import quota Suppose the U.S. Department of Commerce reverses its decades-old policy of not applying duties to imports from non-market economies and announces that it will apply an antidumping tariff against China to the full extent allowed under the WTO rules. In response to this announcement, Chinese producers of coated paper raise their export prices to avoid paying the duty Suppose this graph shows the market for coated paper in the United States, where D is the demand curve, S is the domestic supply curve, and PM is the initial price of imported coated paper. PRICE Dollars per ton! 1000 Price of Imports 900 Eftect on PSExplanation / Answer
Countervailing duties: No, as there is no subsidies involved
An anti-dumping duty: No, as there is no import tax/tariff from China
An Safeguard tariff: No, as it is opposite for US, China could enforce this.
An export subsidy to US producers:No, It is not going to change the situation in China
An import quota: Yes, as this means there is a limited quota finalized for US
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