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If a firm exports, the profits are higher, because the firm serves an additional market. Also, profits now depend negatively on tariffs: the higher the tariffs, the higher the cost of exporting. Finally, these firms pay upfront costs to set up operation

June 4, 2024 /0 Comments/in /by

If a firm exports, the profits are higher, because the firm serves an additional market. Also, profits now depend negatively on tariffs: the higher the tariffs, the higher the cost of exporting. Finally, these firms pay upfront costs to set up operation