The diagram below shows the domestic demand and supply curves for denim jeans in Canada.The prevailing world price is PW.Assume that all jeans are identical.
FIGURE 34- 2
-Countervailing duties are a method of trade restriction designed to offset

Question

The diagram below shows the domestic demand and supply curves for denim jeans in Canada.The prevailing world price is PW.Assume that all jeans are identical.
  FIGURE 34- 2
-Countervailing duties are a method of trade restriction designed to offset

Quizplus · Accepted Answer

Countervailing duties are tariffs imposed on goods from a foreign country that is believed to be subsidized by its government, therefore creating an unfair advantage in the market. Thus, countervailing duties are designed to offset the effects of subsidies by foreign governments.

The Diagram Below Shows the Domestic Demand and Supply Curves