A) Using the prior graph if the U.S. did not trade what price would the good cost? If the world price was $200 what quantity would the U.S. produce? What quantity would be imported. What is consumer surplus at the world price? What is producer surplus at the world price? (Using labels do not use math) Who benefits from the free trade and who gets hurt? B) If the U.S. government puts a tariff on the good so now the price is $300 who benefits, who is hurt? What quantity will S. producers now produce? What happens to consumer surplus and producers’ surplus at this new price? What does the government gain from the tariff?Who benefits from free trade overall? C) Who benefits from trade restrictions? Why is a tariff the most used trade restriction?
A) Using the prior graph if the U.S. did not trade what price would the good cost? If the world price was $200 what quantity would the U.S. produce? What quantity would be imported. What is
B) If the U.S. government puts a tariff on the good so now the price is $300 who benefits, who is hurt? What quantity will S. producers now produce? What happens to
C) Who benefits from trade restrictions? Why is a tariff the most used trade restriction?
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