7. Lobbying for or against trade restrictionsTrade restrictions affect the overall welfare of an economy, sin'ce they change the price consumers pay for a good and the quantity produced andconsumed domestically.Trade restrictions, such as quotas, usually benefit domestic▼ and hurt domesticsince theythedomestic price of a good.True or False: Producers find it difficult to exert the political influence needed to establish trade restrictions, because the benefits to producers arevery small and widely dispersed, which makes it difficult for producers to organize.O FalseO True

Answered: Image /qna-images/answer/ed1e04b2-8fdf-44fe-b7b8-fd81d2911408.jpg

7. Lobbying for or against trade restrictions Trade restrictions affect the overall welfare of an economy, since they change the price consumers pay for a good and the quantity produced and consumed domestically. Trade restrictions, such as quotas, usually benefit domestic and hurt domestic since they v the domestic price of a good. True or False: Producers find it difficult to exert the political influence needed to establish trade restrictions, because the benefits to producers are very small and widely dispersed, which makes it difficult for producers to organize. O False O True

7. Lobbying for or against trade restrictions Trade restrictions affect the overall welfare of an economy, since they change the price consumers pay for a good and the quantity produced and consumed domestically. Trade restrictions, such as quotas, usually benefit domestic and hurt domestic since they v the domestic price of a good. True or False: Producers find it difficult to exert the political influence needed to establish trade restrictions, because the benefits to producers are very small and widely dispersed, which makes it difficult for producers to organize. O False O True

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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2. Workers in industries protected by tariffs and quotas are likely to support these trade restrictionsbecause they believe the restrictions will protect their jobs.a. True b. False3. Imports are goods and services bought domesticallya. and produced domestically. b. but produced in other countries.c. and resold at a profit. d. and subject to tariffs.e. and not subject to tariffs.4. Which of the following are examples of non-tariff barriers? (Choose all that apply).a. Imported products have to comply with new health and safety regulations.b. A quota is imposed on imports of certain goods.c. There is a prohibition to import certain goods due to national security concerns.d. Tariffs are increased to restrict imports from one or more countries.e. Importers need to fill additional paperwork that makes certain imports more difficult.
5. Both foreign (Sf) and domestic steel (Sd) producers supply the US market (Sdtf is the combined supply curve). US Steel Market without Tariff US Steel Market with Tariff 10 O 10 20 30 40 s0 60 70 80 90 100 Quanity in millions of tons per year D 10 20 30 40 50 60 70 80 90 100 Quantity in millions of tons per Year 0 d st Sdet D -Sd St -Sdef a. After the imposition of the tariff, what is the approximate price of steel? Answer: b. How much of the $200 per ton tariff is paid by domestic consumers of steel? Answer: C. How is the quantity of steel consumed in the US affected? Answer: d. Who benefits and who is harmed by the tariff? Answer. asn soot u uo ad aous Price per Ton in 100s US0
1. Suppose the electronic calculator industry faces severe foreign competition, and asks you to prepare a position paper its lobbyist can use to seek government assistance. Contrast the consequences of imposing a quota, negotiating a VER, and providing a production subsidy. 2. At free-trade prices, a widget sells for $20 and contains $8 worth of tin and $6 worth of rubber. In Country A nominal tariff rates are: What is the effective rate of protection on widgets in Country A? Explain briefly the economic meaning of your result. If this country were a large exporter of widgets, how would that affect your interpretation of the effective rate of protection received by this industry?
3. Using the graph to the right, suppose the country opens up to international trade, the world price is $40, and the government institutes a $10 tariff on each unit imported. What is the quantity demanded, quantity produced domestically, quantity imported from abroad, consumer surplus, producer surplus, tariff revenue, and deadweight loss? Price 0 10 20 30 40 50 60 70 80 90 100 0 50 Comestic Supply Domestic Demand 100 150 200 250 300 350 400 450 Quantity 500
Refer to the below graph, where Sa and Da are the domestic supply and demand for a product. $16 14 12 Price 10 8 6 4. 2 0 1 export. neither both 1 import IS 1 1 T T 1 13 1 1 1 20 40 60 80 100 120 140 160 180 Quantity What will this nation do if it were open to international trade and the world price was $8? 1 Sd Da
140 PRICE (Dollars per unit of coffee) ४ 10 110 8 A B C D Domestic Supply World Price Domestic Demand 18 30 BUANTITY (Units of coffee) Refer to Figure 9-1. When trade in coffee is allowed, consumer surplus in Guatemala O increases by the area B + D. O increases by the area C + F. O decreases by the area D + G. decreases by the area B + D.
Question 3 Like tariffs, quotas tend to lead to higher prices and reduced imports. increased government revenue. O increased consumer surplus. O All of these.
In the figure to the right, the importing country imposes a tariff that raises the domestic price from $8 to $12 but lowers the foreign export price from $8 to $4. The net welfare gain from this tariff for the importing country is OA. $18. OB. $4. OC. $34. O D. $16. 24- 22- 20- 18- 16- 14- 12- 10- 8- 6- 4- 2- 0- C Price, P 1 2 3 5 6 S d 8 D 9 10 11 12 Quantity, Q
QUESTION 3 A nation will import a good if its no-trade, domestic: O price is equal to the world price. 000 0 price is greater than the world price. price is less than the world price. O quantity is less than the world quantity.
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
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 the 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 $210 per ton of steel and a quantity of 16 million tons. At this price, the United States imports 12 million tons of steel. Suppose the U.S. government imposes a $75-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 (SD+W+T). Then use the grey point (star symbol) to indicate the new…
6. Tariffs and quotas compared Tariffs and quotas can potentially benefit domestic producers of protected products. Which of the following arguments do economists make? Nontariff barriers are more economically efficient. The societal gains from free trade are greater as a result of specialization. The gains to domestic consumers are even higher because of lower prices. This has almost no effect on foreign consumers and foreign producers.