The United States and many other countries often impose trade sanctions on other countries.These sanctions
A) decrease producer and consumer surplus in both the sanctioned and sanctioning countries.
B) tend to increase total welfare.
C) tend to decrease the deadweight loss.
D) tend to decrease consumer and producer surplus only in the sanctioned country.

Question

Quizplus · Accepted Answer

Trade sanctions typically decrease producer and consumer surplus in both the sanctioned and sanctioning countries by limiting access to markets, increasing costs, and reducing the efficiency of trade. This leads to a decrease in economic welfare for both parties involved.

The United States and Many Other Countries Often Impose Trade