If Bangladesh allows international trade in the market for maize, it will import [Now suppose the Bangladeshi government decides to impose a tariff of $80 on each imported ton of maize. After the tariff, the price Bangladeshiconsumers pay for a ton of maize is 5,and Bangladesh will importtons of maize.Show the effects of the $80 tariff on the following graph.Use the black line (plus symbol) to indicate the world price plus the tariff. Then, use the green triangle (triangle symbols) to show the consumersurplus with the tariff and the purple triangle (diamond symbols) to show the producer surplus with the tariff. Lastly, use the orange quadrilateral(square symbols) to shade the area representing government revenue received from the tariff and the tan triangles (dash symbols) to shade the areasrepresenting the net loss or deadweight loss (DWL) caused by the tariff.7106700305905505104703003100Domestic Demand208 10 12 14 10 18QUANTITY (Thousands of tons of maize)Domestic SupplyConsumer SurplusProducer SurplusGovernment Revenue200World Price Plus TariffCSPSShow Transcribed TextGovernment RevenueDWLComplete the following table to summarize your results from the previous two graphs.Under Free Trade(Dollars)Under a Tariff(Dollars)tons of maize.Based on your analysis, as a result of the tariff, Bangladesh's consumer surplusby S, and the government collects Sby S, producer surplusin revenue. Therefore, the net welfare effect is a of 3. Welfare effects of a tariff in a small countrySuppose Bangladesh is open to free trade in the world market for maize. Because of Bangladesh's small size, the demand for and supply of maize inBangladesh do not affect the world price. The following graph shows the domestic maize market in Bangladesh. The world price of maize is Pw=$350per ton.On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at thefree-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing producer surplus (PS).PRICE (Dollars per ton)710670630500550510470430300350310Domestic Demand10Domestic Supply10QUANTITY (Thousands of tons of maize)18 208PS

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If Bangladesh allows international trade in the market for maize, it will import [ tons of maize. Now suppose the Bangladeshi government decides to impose a tariff of $80 on each imported ton of maize. After the tariff, the price Bangladeshi consumers pay for a ton of maize is 5 , and Bangladesh will import tons of maize.

If Bangladesh allows international trade in the market for maize, it will import [ tons of maize. Now suppose the Bangladeshi government decides to impose a tariff of $80 on each imported ton of maize. After the tariff, the price Bangladeshi consumers pay for a ton of maize is 5 , and Bangladesh will import tons of maize.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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