If Colombia is open to international trade in oranges without any restrictions, it will import Suppose the Colombian government wants to reduce imports to exactly 80 tons of oranges to help domestic producers. A tariff of S will achieve this. A tariff set at this level would raise $ tons of oranges. in revenue for the Colombian government. per ton
If Colombia is open to international trade in oranges without any restrictions, it will import Suppose the Colombian government wants to reduce imports to exactly 80 tons of oranges to help domestic producers. A tariff of S will achieve this. A tariff set at this level would raise $ tons of oranges. in revenue for the Colombian government. per ton
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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I need help with this question. Also, can you please draw the graphs as well? Thanks in advance!!
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Transcribed Image Text:If Colombia is open to international trade in oranges without any restrictions, it will import
Suppose the Colombian government wants to reduce imports to exactly 80 tons of oranges to help domestic producers. A tariff of S
will achieve this.
A tariff set at this level would raise $
tons of oranges.
in revenue for the Colombian government.
per ton
Transcribed Image Text:The following graph shows the domestic demand for and supply of oranges in Colombia. The world price (Pw) of oranges is $530 per ton and is
displayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demanded
by any one country does not affect the world price of oranges and that there are no transportation or transaction costs associated with international
trade in oranges. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes
place.
PRICE (Dollars per ton)
980
930
880
8:30
780
730
680
630
580
530
480
0
Domestic Demand
40
80
Domestic Supply
PW
120 160 200 240 280 320 360 400
QUANTITY (Tons of oranges)
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