The figure below shows the hypothetical domestic supply and demand for baseball caps in the country of Spain. Domestic Supply and Demand for Baseball Caps Spain 10 9 Sa Dd 10 20 30 40 50 60 70 80 90 100 Baseball caps (thousands per month) Suppose that the world price of baseball caps is €1 and there are no import restrictions on this product. Assume that S consumers are indifferent between domestic and imported baseball caps. Instructions: Enter your answers as whole numbers. a. What quantity of baseball caps will domestic suppliers supply to domestic consumers? thousand b. What quantity of baseball caps will be imported? thousand Now suppose a tariff of €3 is levied against each Imported baseball cap. c. After the tariff is implemented, what quantity of baseball caps will domestic suppliers supply to domestic consumers thousand d. After the tariff is Implemented, what quantity of baseball caps will be imported? thousand Price (€ per cap) 8 N 10 50 4 3 2 1 0

The figure below shows the hypothetical domestic supply and demand for baseball caps in the country of Spain. Domestic Supply and Demand for Baseball Caps Spain 10 9 Sa Dd 10 20 30 40 50 60 70 80 90 100 Baseball caps (thousands per month) Suppose that the world price of baseball caps is €1 and there are no import restrictions on this product. Assume that S consumers are indifferent between domestic and imported baseball caps. Instructions: Enter your answers as whole numbers. a. What quantity of baseball caps will domestic suppliers supply to domestic consumers? thousand b. What quantity of baseball caps will be imported? thousand Now suppose a tariff of €3 is levied against each Imported baseball cap. c. After the tariff is implemented, what quantity of baseball caps will domestic suppliers supply to domestic consumers thousand d. After the tariff is Implemented, what quantity of baseball caps will be imported? thousand Price (€ per cap) 8 N 10 50 4 3 2 1 0

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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