If Venezuela is open to international trade in oranges without any restrictions, it will importSuppose the Venezuelan government wants to reduce imports to exactly 80 tons of oranges to help domestic producers. A tariff ofwill achieve this.A tariff set at this level would raise $tons of oranges.in revenue for the Venezuelan government.per ton 4. Effects of a tariff on international tradeThe following graph shows the domestic demand for and supply of oranges in Venezuela. The world price (Pw) of oranges is $530 per ton and isdisplayed as a horizontal black line. Throughout the question, assume that all countries under consideration are small, that is, the amount demandedby any one country does not affect the world price of oranges and that there are no transportation or transaction costs associated with internationaltrade in oranges. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takesplace.PRICE (Dollars per ton)935 Domestic Demand119084580075571066562057553048504080Domestic Supply120 160 200 240 280 320 360 400QUANTITY (Tons of oranges)If Venezuela is open to international trade in oranges without any restrictions, it will importtons of oranges.

Equilibrium is achieved under autarky where quantity supplied equals quantity demand.

If Venezuela is open to international trade in oranges without any restrictions, it will import Suppose the Venezuelan 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 Venezuelan government. per t

If Venezuela is open to international trade in oranges without any restrictions, it will import Suppose the Venezuelan 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 Venezuelan government. per t

ENGR.ECONOMIC ANALYSIS

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ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Question

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

4. Effects of a tariff on international trade
The following graph shows the domestic demand for and supply of oranges in Venezuela. 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)
935 Domestic Demand
1190
845
800
755
710
665
620
575
530
485
0
40
80
Domestic Supply
120 160 200 240 280 320 360 400
QUANTITY (Tons of oranges)
If Venezuela is open to international trade in oranges without any restrictions, it will import
tons of oranges.

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