The following graph shows the domestic supply of and demand for wheat in Kenya. Kenya is open to international trade of wheat without any restrictions. The world price (Pw) of wheat is $255 per bushel and is represented by the horizontal black line. Throughout this problem, 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. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per bushel) 525 495 465 435 405 375 345 315 285 255 225 1 Supply Demand W 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of bushels of wheat) A tariff set at this level would raise $ Graph Input Tool Market for Wheat in Kenya Price (Dollars per bushel) Domestic Demand (Thousands of bushels of wheat) If Kenya is open to international trade of wheat without any restrictions, it will import value for your answer, accounting for the horizontal axis units.) 465 20 in revenue for the Kenyan government. Domestic Supply (Thousands of bushels of wheat) Suppose the Kenyan government wants to reduce imports to exactly 40,000 bushels of wheat to help domestic producers. A tariff of $ bushel will achieve this. ? 80,000 bushels of wheat. (Note: Be sure to enter the full 80 per
The following graph shows the domestic supply of and demand for wheat in Kenya. Kenya is open to international trade of wheat without any restrictions. The world price (Pw) of wheat is $255 per bushel and is represented by the horizontal black line. Throughout this problem, 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. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per bushel) 525 495 465 435 405 375 345 315 285 255 225 1 Supply Demand W 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Thousands of bushels of wheat) A tariff set at this level would raise $ Graph Input Tool Market for Wheat in Kenya Price (Dollars per bushel) Domestic Demand (Thousands of bushels of wheat) If Kenya is open to international trade of wheat without any restrictions, it will import value for your answer, accounting for the horizontal axis units.) 465 20 in revenue for the Kenyan government. Domestic Supply (Thousands of bushels of wheat) Suppose the Kenyan government wants to reduce imports to exactly 40,000 bushels of wheat to help domestic producers. A tariff of $ bushel will achieve this. ? 80,000 bushels of wheat. (Note: Be sure to enter the full 80 per
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
Transcribed Image Text:The following graph shows the domestic supply of and demand for wheat in Kenya. Kenya is open to international trade of wheat without any
restrictions. The world price (Pw) of wheat is $255 per bushel and is represented by the horizontal black line. Throughout this problem, 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.
Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph.
Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly.
PRICE (Dollars per bushel)
525
495
465
435
405
375
345
315
285
255
225
1
Supply
Demand
W
0 10 20 30 40 50 60 70 80 90 100
QUANTITY (Thousands of bushels of wheat)
A tariff set at this level would raise $
Graph Input Tool
Market for Wheat in Kenya
Price
(Dollars per bushel)
Domestic Demand
(Thousands of
bushels of wheat)
If Kenya is open to international trade of wheat without any restrictions, it will import
value for your answer, accounting for the horizontal axis units.)
465
20
in revenue for the Kenyan government.
Domestic Supply
(Thousands of
bushels of wheat)
Suppose the Kenyan government wants to reduce imports to exactly 40,000 bushels of wheat to help domestic producers. A tariff of $
bushel will achieve this.
?
80,000 bushels of wheat. (Note: Be sure to enter the full
80
per
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