Business, 23.06.2021 18:00, lasdivisionst6459

Suppose that with free trade, the cost to the United States of importing a shirt from Mexico is $15.00, and the cost of importing a shirt from China is $12.00. A shirt produced in the United States costs $20.00. Suppose further that before NAFTA, the United States maintained a tariff of 50% against all shirt imports. Then, under NAFTA, all tariffs between Mexico and the United States are removed, while the tariff against imports from China remains in effect. Assume that the tariff does not affect the world price of shirts. In the following table, indicate which country the United States imported shirts from before NAFTA. Then indicate which country the United States imported shirts from under NAFTA.

Stakeholder Gains Loses Neither Gains nor Loses

Chinese producers
Consumers in the United States
U. S. government
Mexican producers

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Suppose that with free trade, the cost to the United States of importing a shirt from Mexico is $15....