Find the revised import expenditure given increased excess demand for manufactures in Figure 1.8. Suppose the international price rises to $6.25 and quantity traded rises to 300. Find the BOT using the export revenue in Figure 1.11.
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Find the revised import expenditure given increased excess demand for manufactures in Figure 1.8. Suppose the international price rises to $6.25 and quantity traded rises to 300. Find the BOT using the export revenue in Figure 1.11.
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- Domestic demand for natural gas in a small economy is characterized by the equation P=350-5QP=350-5Q , domestic supply is characterized by the equation Q=0.5-P+35Q=0.5-P+35 , and the world price is equal to $60. An export tariff of $6 per unit will Group of answer choices result in net welfare loss of 14.6 lead to a loss in consumer surplus lead to an export level that is less than half of the original amount result in tariff revenue that is larger than the loss in producer surplusPolicymakers in a small country impose a specific tariff of $2.00 per unit. Prior to the tariff the country imported 10,000 units and after the tariff 8,000 units. The redistributive effects of the tariff are: Select one: a. such that $16,000 is forward shifted onto domestic consumers. b. impossible to determine with the information given. c. shared equally between domestic producers and domestic consumers. d. such that $4,000 is backward shifted onto domestic producers.If the United States is currently importing 14 million barrels per day at a world price of $4.00 per unit (the entire amount consumed), what is the effect on imports of a tax equal to $8.00 per unit? Price per Barrel Quantity of Barrels Supplied (Millions) Quantity of Barrels Demanded (Millions) $4 0 14 8 12 16 20 24 28 Using the table above, after the imposition of the $8.00 per-unit tax, the new quantity supplied is number.) 2 4 6 8 10 12 13 12 11 10 9 8 million barrels and the new quantity demanded is million barrels. (Enter your responses as a whole
- China placed tariffs on the importation of US soybeans. Assume that the domestic market for soybeans in China is described by the following equations: Demand: P = 11.5 – Q Supply: P = 5.5 + Q Price is in 10 Yuan (¥) per bushel of soybeans and the units for Quantity are 100 million bushels per year. This is to make graphing simpler. This does NOT mean that the price is 10 and quantity is 100. Rather it means that if the price was 40¥ and the quantity was 7,500,000,000 bushels, this would plot as 4 and 7.5 respectively. The world price for soybeans is ¥65/bushel (this would graph as a horizontal line at 6.5). Graph the soybean market in China showing equilibrium both with no barriers to trade and with a ¥15/bushel tariff. Be sure to fully and clearly label the graph including: Domestic Demand curve (D), Domestic Supply curve (S), the World Price (WP), and the Price with tariffs (PT), along with the quantities imported both with and without the tariff. Based on your graph, what…Price $36 $30 $26 Home market O $200. $240. $80. $160. 20 40 80 100 Quantity Price World market 40 80 X + t Imports If a tariff of $10 is imposed by the home country, it causes a loss in the world market (exclusive of any effects on the home market) of:Suppose you have the following for white t-shirts market:Market demand is P=125-(3/8)QMarket supply is P=5+(1/8)Q. Suppose it is now possible to obtain white t-shirts from the rest of the world at $15 per item at anygiven quantity. In other words, there is now a global supply that is horizontal at $15.a. Obviously the world price and domestic price will now be $15. Calculate the quantityproduced and demanded domestically. Calculate the difference as imports from the rest of theworld.b. Calculate the CS (Consumer Surplus) and PS (Producer Surplus) under free trade. Who gainswith free trade? Who loses?Hint: Use graphs first.
- THE SHRINKING STEEL INDUSTRY Few industries have been harder hit by rising imports – and have made greater demands at the political level – than the steel industry. Its persistence apparently paid off when, in March 2002, George W. Bush agreed to impose a tariff of up to 30% on steel imports. The steel industry claimed that was barely enough to offset the combination of a stronger dollar and ‘‘dumping’’ by steel companies around the world because of a glut of excess capacity. It also requested, but did not receive, money from the government to pay the retirement and healthcare benefits for those pensioners who had received generous benefits when the industry was profitable. Without jettisoning this cost, the industry claimed, it could not consolidate and hence become competitive against worldwide competition. The positive impacts of such a move to employers and shareholders of the steel industry are obvious. But what about the negative impacts?…Assume that the weekly domestic demand for petroleum is represented by the equation: P= -2.25Q + 600. And, the weekly domestic supply of petroleum is represented by the equation: P= 1.5Q + 25. Assume also, that the world price of petroleum is $200. What is the domestic autarky price and quantity when this economy is closed to trade? What would be the total quantity of petroleum demanded when the economy is open to international trade? What would be the volume of imports when the economy is open to trade? What is the import dependency ratio in this economy when it is open for international trade in petroleum?Domestic Demand supply Domestic supply + imports $8 C $4 Qs Q Qd International Trade Two trading partners expand a previous free trade agreement to include sugar. What is the new domestic price of sugar? Provide your answer below:
- The following graph shows the domestic market for oil in the United States, where SDSD is the domestic supply curve, and DDDD 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 oil. Under free trade, the United States faced a total supply schedule of SD+WSD+W, which shows the quantity of oil that both domestic and foreign producers together offer domestic consumers. In this case, the free-trade equilibrium (black plus) occurs at a price of $240 per barrel of oil and a quantity of 9 million barrels. At this price, the United States imports 6 million barrels of oil. Suppose the U.S. government imposes a $60-per-barrel tariff on oil imports.The tsunamis that hit Japan in 2011 and India and Sri Lanka in 2004 were devastating, and their effects were felt for many years afterward. Natural disasters of this type as well as international events often result in severe disruptions to the supply ofallegations that meat inspectors and politicians had received bribes to overlook improper meat packing practices and allow sales of tainted food. How would the closing of export markets for a country’s beef products together with a fall in domestic sales of beef products and an increase in the domestic equilibrium quantity be reflected in supply-anddemand diagrams of that country’s foreign and domestic markets for beef in the short run?Assume that the United States, as a steel-importing nation, is large enough so that changes in the quantity of its imports influence the world price of steel. The following table shows the U.S. supply and demand schedules for steel, along with the overall amount of steel supplied to U.S. consumers by domestic and foreign producers. Price Quantity Supplied (Dollars per ton) (Domestic) (Domestic plus Imports) Quantity Demanded 100 0 0 15 200 4 14 300 8 13 400 12 12 500 16 11 600 20 10 700 5 24 9 Using the data in the table, use the blue points (circle symbol) to plot the demand curve and use the orange points (square symbol) to plot the supply curve (domestic plus imports) on the following graph. Then use the black cross to indicate the equilibrium price and quantity. BOO -O Demand -P Supply us free trade + Equilibrium Free trade 4 Supply wond wit Equilibrium PRICE (Dollars per fon) 700 600 500 400 300 200 100+ 0 6 0 1 2 3 4 10 12 14 16 18 20 22 24 0 2 4 QUANTITY (Tons of steel) With…