4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for soybeans in Colombia. The world price (Pw) of soybeans is $550 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. PRICE (Dollars per ton) 830 Domestic Demand. 795 760 725 690 655 620 585 550 515 480 0 + 1 1 Domestic Supply I 1 A tariff set at this level would raise $ Pw 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of soybeans) ? If Colombia is open to international trade in soybeans without any restrictions, it will import Suppose the Colombian government wants to reduce imports to exactly 120 tons of soybeans to help domestic producers. A tariff of $ will achieve this. tons of soybeans. in revenue for the Colombian government. per ton
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for soybeans in Colombia. The world price (Pw) of soybeans is $550 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. PRICE (Dollars per ton) 830 Domestic Demand. 795 760 725 690 655 620 585 550 515 480 0 + 1 1 Domestic Supply I 1 A tariff set at this level would raise $ Pw 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of soybeans) ? If Colombia is open to international trade in soybeans without any restrictions, it will import Suppose the Colombian government wants to reduce imports to exactly 120 tons of soybeans to help domestic producers. A tariff of $ will achieve this. tons of soybeans. in revenue for the Colombian government. per ton
Principles of Macroeconomics (MindTap Course List)
7th Edition
ISBN:9781285165912
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter9: Application: International Trade
Section: Chapter Questions
Problem 8PA
Related questions
Question
100%
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Principles of Macroeconomics (MindTap Course List)
Economics
ISBN:
9781285165912
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou…
Economics
ISBN:
9781285165875
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Macroeconomics (MindTap Course List)
Economics
ISBN:
9781285165912
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics, 7th Edition (MindTap Cou…
Economics
ISBN:
9781285165875
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics
Economics
ISBN:
9781305156050
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Essentials of Economics (MindTap Course List)
Economics
ISBN:
9781337091992
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Microeconomics (MindTap Course List)
Economics
ISBN:
9781305971493
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning
Principles of Economics (MindTap Course List)
Economics
ISBN:
9781305585126
Author:
N. Gregory Mankiw
Publisher:
Cengage Learning