47. Suppose that Home is a large country. Continue to assume that the free-trade world price is $100 per ton and that the Home government provides the domestic producer with an export subsidy in the amount of $40 per ton. Because of the export subsidy, the local price increases to $120 while the foreign market price declines to $80 per ton. Home price 120 100 80 D 15 20 40 45 Quantity What is the government expenditure? a. 600 b. 800 с. 1200

47. Suppose that Home is a large country. Continue to assume that the free-trade world price is $100 per ton and that the Home government provides the domestic producer with an export subsidy in the amount of $40 per ton. Because of the export subsidy, the local price increases to $120 while the foreign market price declines to $80 per ton. Home price 120 100 80 D 15 20 40 45 Quantity What is the government expenditure? a. 600 b. 800 с. 1200

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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