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"A Country Can Be Left Worse Off as a Result

Question 50

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"A country can be left worse off as a result of free trade and/or exporting the wrong products if there are no policies that force market decision-makers to internalize the costs associated with the production of certain goods and services." Do you agree or disagree with the statement? Illustrate your answer with the help of relevant diagrams.

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Consider the case of an industry whose p...

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