b. Use the letters and values in the graph to fill in the following table. Without tariff With import tariff Price Quantity demanded Quantity supplied Domestic consumer surplus Domestic producer surplus Government revenue Total economic surplus c. If the government decides to replace the tariff with a quota that will have the same effect on the market as the tariff, the quota should restrict imports to
b. Use the letters and values in the graph to fill in the following table. Without tariff With import tariff Price Quantity demanded Quantity supplied Domestic consumer surplus Domestic producer surplus Government revenue Total economic surplus c. If the government decides to replace the tariff with a quota that will have the same effect on the market as the tariff, the quota should restrict imports to
Essentials of Economics (MindTap Course List)
8th Edition
ISBN:9781337091992
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter9: Application: International Trade
Section9.2: The Winners And Losers From Trade
Problem 2QQ
Related questions
Question
The United States has historically imposed import tariffs on goods that include tobacco, canned tuna, steel, and aluminum. Suppose the market for tobacco is illustrated by the accompanying graph.
![10
World price with tariff
Domestic supply
8
A
7
G
H
В
E
F
K
3
L
M
World price
1
Domestic demand
Q
R
S
U
1
2
3
4
6.
7
8.
Quantity (millions of pounds)
a. As shown, the world price is $2 per pound. Suppose the U.S. imposes a tariff of $1 per pound. Adjust the price line
labeled "World price with tariff" (at the top of the graph) to reflect this tariff.
CO
4.
Price ($ per pound)](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F808f9cac-c7d7-4439-9573-5012350d016a%2F4d5362d4-080b-48ff-b578-6ec083d4563e%2F5fv25zj_processed.png&w=3840&q=75)
Transcribed Image Text:10
World price with tariff
Domestic supply
8
A
7
G
H
В
E
F
K
3
L
M
World price
1
Domestic demand
Q
R
S
U
1
2
3
4
6.
7
8.
Quantity (millions of pounds)
a. As shown, the world price is $2 per pound. Suppose the U.S. imposes a tariff of $1 per pound. Adjust the price line
labeled "World price with tariff" (at the top of the graph) to reflect this tariff.
CO
4.
Price ($ per pound)
![b. Use the letters and values in the graph to fill in the following table.
Without tariff
With import tariff
Price
Quantity demanded
Quantity supplied
Domestic consumer
surplus
Domestic producer
surplus
Government revenue
Total economic surplus|
c. If the government decides to replace the tariff with a quota that will have the same effect on the market as the tariff, the
quota should restrict imports to](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F808f9cac-c7d7-4439-9573-5012350d016a%2F4d5362d4-080b-48ff-b578-6ec083d4563e%2F5u1bw0a_processed.png&w=3840&q=75)
Transcribed Image Text:b. Use the letters and values in the graph to fill in the following table.
Without tariff
With import tariff
Price
Quantity demanded
Quantity supplied
Domestic consumer
surplus
Domestic producer
surplus
Government revenue
Total economic surplus|
c. If the government decides to replace the tariff with a quota that will have the same effect on the market as the tariff, the
quota should restrict imports to
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