The nation of Cologne is "large," but unable to affect world prices. It imports chocolate at the price of $20 per box. The demand curve is: D= 700 10P.. The supply curve is S= 200 + 5P. Determine the free trade equilibrium. Then calculate and graph the following effects on an import quota that limits imports to 50 boxes: a. The increase in the domestic price. b. The quota rents. c. The consumption distortion loss. d. The production distortion loss.

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