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If Kenya is open to international trade in wheat without any restrictions, it will import Suppose the Kenyan government wants to reduce imports to exactly 160 bushels of wheat to help domestic producers. A tariff of $ will achieve this. A tariff set at this level would raise $ bushels of wheat. in revenue for the Kenyan government. per bushel

If Kenya is open to international trade in wheat without any restrictions, it will import Suppose the Kenyan government wants to reduce imports to exactly 160 bushels of wheat to help domestic producers. A tariff of $ will achieve this. A tariff set at this level would raise $ bushels of wheat. in revenue for the Kenyan government. per bushel

Principles of Economics 2e
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter34: Globalization And Protectionism
Section: Chapter Questions
Problem 55P: Assume two countries, Thailand (T) and Japan (J), have one good: cameras. The demand (d) and supply...
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If Kenya is open to international trade in wheat without any restrictions, it will import Suppose the Kenyan government wants to reduce imports to exactly 160 bushels of wheat to help domestic producers. A tariff of $ will achieve this. A tariff set at this level would raise $ bushels of wheat. in revenue for the Kenyan government. per bushel
Transcribed Image Text:If Kenya is open to international trade in wheat without any restrictions, it will import Suppose the Kenyan government wants to reduce imports to exactly 160 bushels of wheat to help domestic producers. A tariff of $ will achieve this. A tariff set at this level would raise $ bushels of wheat. in revenue for the Kenyan government. per bushel
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for wheat in Kenya. The world price (Pw) of wheat is $250 per bushel and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of wheat and that there are no transportation or transaction costs associated with international trade in wheat. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. PRICE (Dollars per bushel) 520 490 460 430 400 370 340 310 280 250 220 Domestic Demand + 0 40 80 Domestic Supply + PW 120 160 200 240 280 320 360 400 QUANTITY (Bushels of wheat) (?)
Transcribed Image Text:4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for wheat in Kenya. The world price (Pw) of wheat is $250 per bushel and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of wheat and that there are no transportation or transaction costs associated with international trade in wheat. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. PRICE (Dollars per bushel) 520 490 460 430 400 370 340 310 280 250 220 Domestic Demand + 0 40 80 Domestic Supply + PW 120 160 200 240 280 320 360 400 QUANTITY (Bushels of wheat) (?)
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