. Given the arguments relating to the new trade theory and strategic trade

policy, what kind of trade policy should business be pressuring

government to adopt?


. You are an employee of a U.S. firm that produces personal computers in

Thailand and then exports them to the United States and other countries

for sale. The personal computers were originally produced in Thailand

to take advantage of relatively low labor costs and a skilled workforce.

Other possible locations considered at the time were Malaysia and Hong

Kong. The U.S. government decides to impose punitive 100 percent ad

valorem tariffs on imports of computers from Thailand to punish the

country for administrative trade barriers that restrict U.S. exports to

Thailand. How should your firm respond? What does this tell you about

the use of targeted trade barriers?