Trade and Environment

Kahoot 2
Syrupian Union imposes a 5% VAT on domestic maple candy and 7%
VAT on imported butterscotch. Cross Price Elasticity of demand is 0.6.
Is this a violation of WTO law?
a. Yes. Violates MFN.
b. Yes. Violates National Treatment Art. III:2.
c. Yes. Violates National Treatment Art. III:4.
d. No. Products are not like. This is the right answer. 0.6 cross-price
elasticity of demand indicates the products being directly
competitive, but not like.
Hogwartsland is concerned with deforestation. Consequently, it demands
that all imported wooden wands be sold with a label "deforestation
product". Does this violate national treatment?
a. Yes. III:4 because labelling requirement is only on imports- making
the internal sale costly.
b. Yes. III:4 because labelling requirement is only on imports and are
discouraging sales of imports
c. both (a) and (b) This is the right answer as the requirement being
imposed only on imports makes their sale in Hogwartsland
expensive, thereby discouraging their sale.
d. No violation
Hogwartsland imposes a 5% VAT on domestically manufactured flying
cars to incentivize low GHG emissions and stating that domestic flying
cars emit lower than imported cars. They impose a 7% VAT on imported
flying cars because of high GHG emissions. The Cross Price Elasticity of
demand is 0.8. Does this violate National Treatment?
a. Yes. III:2 violation. This is the right answer as the measure
imposes a higher tax on imports as compared to like domestic
products.
b. Yes. III:4 violation.
c. Not an NT violation.
d. No violation.