The graph below shows the market for good X in US. US's trading partner is Chinaand is the world price associated with an international trade equilibrium. Assumethat these two countries only trade with each other.PD325S200150ABDEPwF10050D2035 507090If US places a tariff of $50 on this market, how much tariff revenue is generated bythe tariff?$4500$2500$3500$750$1750

Ans. ) The given graph shows the market for good X in U.S. Domestic equilibrium is at the…

Answered: The graph below shows the market for…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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P F Q2. Suppose a large country A initially imposes a tariff on its steel imports from the rest of the world. Use a domestic-market graph to: (a) show the effect of eliminating tariffs on country A’s import price, import quantity, consumer surplus, producer surplus, and government revenue; (b) identify country A’s net welfare change as a result of the tariff elimination; Your answer:
Home Demand: 90 - 2Pt Foreign Demand: 50 - 4Pt*Home Supply: 30 + 2Pt Foreign Supply: 10 + 2Pt* There are demand and supply functions for good corn for the home country and demand and supply functions for good wheat for the foreign country. Home country as an importer and foreign country as an exporter trade with each other, at zero cost of transportation.A. Find and graph the equilibrium under free trade. What is the world price and the volume of trade? Also, in the absence of trade, what are the prices that would prevail in home country for corn and in foreign country for wheat?.(Pt = Pt* = Pw -> Pw; world prices) B. Suppose home imposes a specific tariff of 5 on corn imports. Find and graph the effects of tariff on price of corn in each country, on the quantity of corn supplied and demanded in each country, on volume of trade? And briefly explain these results in relation to the effects of the tariff? C. Let the tariff conditions in section (b) be valid. Determine and graph…
If the government of brazil allows free trade and the world price is $10, then
5. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for soybeans in Guatemala. Guatemala is open to international trade of soybeans without any restrictions. The world price (Pw) of soybeans is $525 per ton and is represented by the horizontal black line. Throughout this problem, assume that the amount demanded by any one country does not affect the world price of soybeans and that there are no transportation or transaction costs associated with international trade in soybeans. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. Use the graph input tool to help you answer the following questions. You will not be graded on any changes you make to this graph. Note: Once you enter a value in a white field, the graph and any corresponding amounts in each grey field will change accordingly. PRICE (Dollars per ton) 840 805 770 735 700 665 630 595 560 525 490…
Based on Figure 1, choose the correct statement. Assume that Nation 2 a small country and imposes a tariff on imports of X. Figure 1. Partial equilibrium analysis effects of a tariff in Nation 2 P,($) Ars 0 |A C 10 J 'M *- 20 30 40 50 60 D, 70 80 1) Nation 2 faces a perfectly inelastic import supply at the world price of Pw = 2 and it can import any quantity of X. 2) Nation 2 faces a perfectly elastic import supply at the world price of Pw = 2 and it can import any quantity of X. 3) Nation 2 faces a perfectly elastic export supply at the world price of Pw = 1 and it can import any quantity of X. 4) Nation 2 faces a perfectly inelastic export supply at the world price of Pw = 1 and it can import any quantity of X.
S=20+20P and D = 100-20P are Home's supply and demand curves for wheat. * S = 40 + 20P and D = 80-20P are Foreign's supply and demand curves for wheat. With free trade the price of wheat is $ (Enter your response rounded to the nearest penny.) Suppose home imposes a specific tariff of $0.50 on wheat. Home consumers will now pay $ and foreign's export price is $ (Round your responses rounded to the nearest penny.) Now assume that foreign is a much larger country. Specifically, Foreign's demand curve for wheat is D = 800-200P. Its supply curve is S = 400 + 200P. * With free trade the price of wheat is $ (Round your response rounded to the nearest penny.) Suppose Home imposes a specific tariff of $0.50 on wheat. Home consumers will now pay $ (Round your response rounded to the nearest penny.) $ In which case does the tariff create the greatest terms of trade gains? When Home is and foreign's export price is
Identify which type of nontariff trade barrier is used in each scenario in the following table. Tariff- Export Selective Rate Global Export Quota Quota Quota Quota Subsidy Scenario Canada permits 634,000 tons of beef to be imported each year. Brazil voluntarily reduces textile exports to Poland. The United States charges a tariff of 4.4¢ per kilogram for the first 634,621 tons of beef and a tariff of 6¢ per kilogram of beef in excess of that threshold. O Canada and Brazil agree that Canada produces 60% of its iDevices in Brazil and is allowed to export iDevices to Brazil tariff-free. Canada permits 634,000 tons of beef to be imported each year-300,000 tons must come from Poland, and 334 tons must come from Brazil. The U.S. producers of automobiles, an import-competing good, receive $100 million from the U.S. government for their production of 250,000 autos. The U.S. government makes a payment to domestic farmers of $1 on each bushel of apples that is exported. O Domestic Production…
Suppose there are three countries, the EU, Mexico, and Asia, in the world and the EU imports electronics from either Mexico or Asia (or both). Assume that Mexico is a small supplier and Asia is a large supplier and the free-trade prices of electronics from Mexico and Asia are PMEXICO=$1,200 and PASIA=$1,000, respectively, and the EU initially imposes a 15% tariff on both Mexico and Asia. Now the EU forms an FTA with Mexico. Use a graph of import demand and export supply curves to show the impact of this FTA on EU’s consumer surplus, government revenue, and welfare. Is the EU better off or worse off with the FTA? In the above graph, identify the effect of the FTA on Mexico’s producer surplus. Suppose after the FTA with the EU, Mexico invests in its electronics industry and lowers its marginal cost such that its free-trade price is PMEXICO=$1,100. How would the graph and the answer in parts (a) and (b) change?
None
2. Welfare effects of a tariff in a small country Suppose Guatemala is open to free trade in the world market for oranges. Since Guatemala is small relative to the international market, the demand for and supply of oranges in Guatemala have no impact on the world price. The following graph shows the domestic market for oranges in Guatemala. The world price of a ton of oranges is Pw = $350. On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at the free-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing producer surplus (PS). PRICE (Dollars per ton) 710 Domestic Demand Domestic Supply 670 630 590 550 510 470 430 28 8 8 8 8 8 8 8 390 350 P. 310 0 15 30 45 60 75 90 105 120 135 150 QUANTITY (Tons of oranges) CS PS Because Guatemala participates in international trade in the market for oranges, it will import tons of oranges. Now suppose the Guatemalan…
3. Welfare effects of a tariff in a small country Suppose Ronduras is open to free trade in the world market for soybeans. Because of Honduras's small size, the demand for and supply of soybeans in Honduras do not affect the world price. The following graph shows the domestic soybeans market in Honduras. The world price of soybeans is Pw = $400 per ton. On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at the free-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing producer surplus (PS). 1200 Domestic Demand Domestic Supply 1100 CS 1000 900 PS 800 700 600 500 400 300 200 100 120 140 160 180 200 20 40 60 80 QUANTITY (Tons of soybeans) PRICE (Dollars pe: ton)
TE 14 21 91 12 21 15 51 Question 13 (4 points) The graph below represents the market for a good in a country that is open to international trade. P represents the global equilibrium price (the world price) of the good. P 17 18 500 20 21 11 212 A 300 B 250 3 24 G ation 50 50 K 80 93 LH D E F 1 S Pw DW 30 90 100 Q What area(s) represent producer surplus if trade is allowed? GK OGHK ABGK Ου BCDEGHK

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