Calculate the quantity of bushels Liechtenstein imports when the three nations engage in free trade. Enter this value in the first row of the following table. Also indicate which country Liechtenstein imports from. Imports Scenario (Thousands of bushels) Imports from... Free trade With tariff With customs union At some point in time, Liechtenstein decides to protect its domestic grain producers and imposes a tariff of $1.60 per bushel of grain on imports from both Canada and France. SCan +Tand Sp+T represent the after-tariff prices for both countries. In the second row of the previous table, enter the quantity of bushels Liechtenstein imports with the tariff and the country it imports from. Later on, Liechtenstein and France form a customs union as part of a trade liberalization agreement, while the trade between Liechtenstein and Canada continues with the previous terms. In the last row of the previous table, enter the quantity of bushels Liechtenstein imports with the customs union and the country it imports from. Complete the following table by identifying which trade effect of the customs union formation is represented by each of the shaded areas on the previous graph. Check all that apply. Area Effect A B Consumption effect
Calculate the quantity of bushels Liechtenstein imports when the three nations engage in free trade. Enter this value in the first row of the following table. Also indicate which country Liechtenstein imports from. Imports Scenario (Thousands of bushels) Imports from... Free trade With tariff With customs union At some point in time, Liechtenstein decides to protect its domestic grain producers and imposes a tariff of $1.60 per bushel of grain on imports from both Canada and France. SCan +Tand Sp+T represent the after-tariff prices for both countries. In the second row of the previous table, enter the quantity of bushels Liechtenstein imports with the tariff and the country it imports from. Later on, Liechtenstein and France form a customs union as part of a trade liberalization agreement, while the trade between Liechtenstein and Canada continues with the previous terms. In the last row of the previous table, enter the quantity of bushels Liechtenstein imports with the customs union and the country it imports from. Complete the following table by identifying which trade effect of the customs union formation is represented by each of the shaded areas on the previous graph. Check all that apply. Area Effect A B Consumption effect
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Transcribed Image Text:On the following graph, the supply and demand schedules of Liechtenstein are shown as SLch and DLeh. Foreign supply schedules of grain are
perfectly elastic: Canada is a more efficient supplier of grain than France because its supply price is $0.80 per bushel (Scan), whereas France's supply
price is $1.60 per bushel (Sp).
(?
8.00
Lch
S.
Lah
7.20
6.40
5.60
4.80
4.00
3.20
Scan +T
2.40
A
1.60
0.80
4
12
20
24
28
32
36
40
PRICE (Dollars)
Transcribed Image Text:Calculate the quantity of bushels Liechtenstein imports when the three nations engage in free trade. Enter this value in the first row of the following
table. Also indicate which country Liechtenstein imports from.
Imports
Scenario
(Thousands of bushels)
Imports from...
Free trade
With tariff
With customs union
At some point in time, Liechtenstein decides to protect its domestic grain producers and imposes a tariff of $1.60 per bushel of grain on imports from
both Canada and France. SCan +Tand S +T represent the after-tariff prices for both countries.
In the second row of the previous table, enter the quantity of bushels Liechtenstein imports with the tariff and the country it imports from.
Later on, Liechtenstein and France form a customs union as part of a trade liberalization agreement, while the trade between Liechtenstein and
Canada continues with the previous terms.
In the last row of the previous table, enter the guantity of bushels Liechtenstein imports with the customs union and the country it imports from.
Complete the following table by identifying which trade effect of the customs union formation is represented by each of the shaded areas on the
previous graph. Check all that apply.
Area
Effect
A
B
Consumption effect
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