9 United States, Canada, and Mexico are part of a free trade area that is now known as " USCMA". Which of the followingstatements is true?All USCMA member countries should use the exact same trade policy against non-USCMA member countriesUnited States, Mexico, and Canada should not impose any tariff rates against German cars despite the fact thatGermany is not part of USCMAUnited States, Mexico, and Canada should impose exactly the same tariff rates against German cars since United States,Mexico, and Canada are part of USCMAUnited States can impose a 20% tariff on German Cars, while Mexico can impose a tarif of 10% on the same Germancars, and Canada can impose a 5% tariff on the same German cars

Answered: United States, Canada, and Mexico are…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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United States, Canada, and Mexico are part of a free trade area that is now known as " USCMA". Which of the following
statements is true?
All USCMA member countries should use the exact same trade policy against non-USCMA member countries
United States, Mexico, and Canada should not impose any tariff rates against German cars despite the fact that
Germany is not part of USCMA
United States, Mexico, and Canada should impose exactly the same tariff rates against German cars since United States,
Mexico, and Canada are part of USCMA
United States can impose a 20% tariff on German Cars, while Mexico can impose a tarif of 10% on the same German
cars, and Canada can impose a 5% tariff on the same German cars

Expert Solution

Step 1

USCMA is a trade agreement between the named parties the United States, Mexico and Canada. It has replaced the North American Free Trade Agreement which was originally implemented in 1994. USMCA carries forward or updates provisions that were there in NAFTA, and is commonly called New NAFTA or NAFTA2.0. The renegotiations were mainly around auto exports, steel and aluminium, dairy, egg, and poultry markets and intellectual property rights.

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