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International Trade Policy

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Why would a country impose a trade embargo on another country? What are a trade embargo's typical effects? Discuss an actual instance of a trade embargo on a country.

Name an industry that experiences economies of scale in production and explain why the industry exhibits this characteristic. What actions can a country's government take which promote or hinder an economies of scale industry?

Please use Japan, China, Taiwan, or Mexico in the example used for this question.

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Embargoes are considered a peaceful means to achieve national security or foreign policy goals. Embargoes often result when there is direct conflict between two countries, but may also occur because of different ideological beliefs. During the Napoleonic wars, trade embargoes were used against Great Britain by European nations. The cessation of trade resulted in hardship for the countries imposing the embargo, more than for Great Britain, and points out the need to carefully consider the results of an embargo. They are typically used by large economies ...

Solution Summary

Economies of scale and goverment actions; trade embargo effects