If Panama is open to international trade in maize without any restrictions, it will import [blank] tons of maize.Suppose the Panamanian government wants to reduce imports to exactly 80 tons of maize to help domestic producers. A tariff of $[blank] per ton will achieve this.A tariff set at this level would raise $[blank] in revenue for the Panamanian government. **4. Effects of a Tariff on International Trade**The following graph shows the domestic supply of and demand for maize in Panama. The world price ($P_W$) of maize is $260 per ton 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 maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place.**Graph Explanation:**- **Axes:** - The vertical axis represents the price of maize in dollars per ton. - The horizontal axis represents the quantity of maize in tons.- **Curves:** - The downward sloping blue line represents **Domestic Demand**. - The upward sloping orange line represents **Domestic Supply**.- **Price Line:** - The horizontal black line at $260 represents the **World Price ($P_W$)**.- **Interactions:** - At $260, the points where the supply and demand curves intersect with the world price line indicate the quantity supplied and demanded domestically at the world price.

Tariff refers to a tax placed on an imported product to generate revenue.

If Panama is open to international trade in maize without any restrictions, it will import tons of maize. Suppose the Panamanian government wants to reduce imports to exactly 80 tons of maize to help domestic producers. A tariff of per ton will achieve this. A tariff set at this level would raise $ in revenue for the Panamanian government.

If Panama is open to international trade in maize without any restrictions, it will import tons of maize. Suppose the Panamanian government wants to reduce imports to exactly 80 tons of maize to help domestic producers. A tariff of per ton will achieve this. A tariff set at this level would raise $ in revenue for the Panamanian government.

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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