Question

8. An economist discussing trade policy in The New Republic wrote: "One of the benefits of the United States removing its trade restrictions [is] the gain to U.S. industries that produce goods for export. Export industries would find it easier to sell their goods abroad—even if other countries didn’t follow our example and reduce their trade barriers." Explain in words why U.S. export industries would benefit from a reduction in restrictions on imports to the United States.

Answer 1

Primarily once imports are permitted to trade spontaneously, imports can rise. This might rise demand for money of states that export to the United States therefore request for USD will decline and flowing to the left. Actual charge per unit decreases and this devaluation will increase trades finally net trades are unaffected and subsequently trades are accumulated national trades are comfortable.

• Exports can rise.
• Imports can rise.
• The demand arc for USD can move to the left.
• The symmetry level of net trades can stay unaffected