1700 Domestic Demand 1600 1500 1400 1300 1200 1100 1000 900 800 700 02 Domestic Supply W 8 10 12 14 16 18 20 QUANTITY (Thousands of tons of oranges) Consumer surplus Producer surplus Government revenue World Price Plus Tariff g Government Revenue DWL implete the following table to summarize your results from the previous two graphs. Under Free Trade (Dollars) Under a Tariff (Dollars) sed on your analysis, as a result of the tariff, Guatemala's consumer surplus decreases by S ncreases and producer surplus Taking into account how much revenue the tariff generates for the government, the net welfare effect

1700 Domestic Demand 1600 1500 1400 1300 1200 1100 1000 900 800 700 02 Domestic Supply W 8 10 12 14 16 18 20 QUANTITY (Thousands of tons of oranges) Consumer surplus Producer surplus Government revenue World Price Plus Tariff g Government Revenue DWL implete the following table to summarize your results from the previous two graphs. Under Free Trade (Dollars) Under a Tariff (Dollars) sed on your analysis, as a result of the tariff, Guatemala's consumer surplus decreases by S ncreases and producer surplus Taking into account how much revenue the tariff generates for the government, the net welfare effect

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for soybeans in Zambia. The world price (Pw) of soybeans is $530 per ton and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of soybeans and that there are no transportation or transaction costs associated with international trade in soybeans. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. 980 Domestic Demand Domestic Supply 930 880 830 780 730 680 630 580 P. 530 480 50 100 150 200 250 300 350 400 450 500 QUANTITY (Tons of soybeans) PRICE (Dollars per ton)
7. Effects of a tariff in a large nation The following graph shows the domestic market for steel in the United States, where Sp is the domestic supply curve, and Dp is the domestic demand curve. Assume the United States is considered a large nation, meaning that changes in the quantity of its imports due to a tariff influence th world price of steel. Under free trade, the United States faced a total supply schedule of Sp.w. which shows the quantity of steel that both domestic and foreign producers together offer domestic consumers. In this case, the free-trade equilibrium (black plus) occurs at a price of $320 per ton of steel and a quantity of 18 million tons. At this price, the United States imports 12 million tons of steel. Suppose the U.S. government imposes a $80-per-ton tariff on steel imports. On the following graph, use the tan line (rectangle symbol) to draw the new total supply schedule including the tariff (Sp.w r). Then use the grey point (star symbol) to indicate the new…
PRICE (Dollars per rose) CO 7 6 5 4 ليا 3 2 Domestic Demand Domestic Supply World Price + Tariff World Price 100 200 300 400 500 600 700 800 QUANTITY (Roses) Refer to Figure 9-3. With trade and without a tariff,
Consider the market for coffee in the small, isolated country of Krakozhia. Within Krakozhia, the domestic demand for coffee is: Q = 500-2p and the domestic supply of coffee is: Q* = -150+ 3p
х 0 150 $1500 $625 $2800 $865 Price of Calculators $27 12 7 2 300 400 Domestic Supply Domestic Demand World Price Quantity of Calculators The figure above shows the domestic market for calculators in Haiti. What is the change in total surplus in Haiti because of trade?
Economics 101
4. Effects of a tariff on international trade The following graph shows the domestic demand for and supply of oranges in Honduras. The world price (Pw) of oranges is $535 per ton and is displayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demanded by any one country does not affect the world price of oranges and that there are no transportation or transaction costs associated with international trade in oranges. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. Domestic Demand 775 735 X 695 655 615 535 + 895 PRICE (Dollars per ton) 855 815 575 495 Domestic Supply 0 50 100 150 200 250 300 350 400 450 500 QUANTITY (Tons of oranges) PW A tariff set at this level would raise ? If Honduras is open to international trade in oranges without any restrictions, it will import Suppose the Honduran government wants to reduce…
Consider the market for coffee in the small, isolated country of Krakozhia. Within Krakozhia, the domestic demand for coffee is: Q = 500-2p and the domestic supply of coffee is: Q* = -150+ 3p
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2 Using the graph, assume that the government imposes a $1 tariff on solar panels. Answer the following questions given this information. Price $13 65 8 Domestic Supply $1.00 Tariff World Price Domestic Demand о 30 40 60 84 96 Quantity a. What is the domestic price and quantity demanded of solar panels after the tariff is imposed? b. What is the quantity of solar panels imported before the tariff? c. What is the quantity of solar panels imported after the tariff? d. What would be the amount of consumer surplus before the tariff? e. What would be the amount of consumer surplus after the tariff? f. What would be the amount of producer surplus before the tariff? g. What would be the amount of producer surplus after the tariff? h. What would be the amount of government revenue because of the tariff? i. What would be the total amount of deadweight loss due to the tariff?
Price (dollars per battery) 20 18 16 14 12 10 8 A 8 C D Sus World price + tariff World price Dus 100 300 500 700 900 1,100 1,300 Quantity (thousands of batteries) The above figure shows the U.S. market for replacement cell phone batteries. When there is no international trade, the equilibrium price is per battery and when there is international trade the equilibrium price is per battery.
Price $16 129 14 12 10 8 co 6 4 2 Sd 0 10 20 30 40 50 60 70 80 90 Quantity Dd Please refer to the graph provided, which displays the domestic supply (S) and demand (D) curves for a certain product. The world price of this product is $6. If this particular market is open to international trade, but there is a tariff of $6 per unit imposed, then the domestic producers will earn $240, the total revenue (after tariff) going to foreign producers would be $240, and the tariff revenue going to the government would be $40 $600, and there will be no imports and no tariff revenue. $120, the total revenue (after tariff) going to foreign producers would be $120, and the tariff revenue going to the government would be $80 O $400, the total revenue (after tariff) going to foreign producers would be $120, and the tariff revenue going to the government would be $40