Use the previous graph to complete the first row of the following table by indicating the quantity of aluminum supplied by U.S. producers, demanded by U.S. consumers, and imported from China under free trade. Quantity Demanded by U.S. Quantity Supplied by U.S. Producers Consumers Quantity Imported from China (Millions of tonnes of aluminum per (Millions of tonnes of aluminum per (Millions of tonnes of aluminum per month) month) month) Free Trade Trade with Tariff Suppose American aluminum manufacturers convince the U.S. government that Chinese firms are selling aluminum in the U.S. market at well below the cost of producing the aluminum, a practice known as dumping. In response to the accusations, the U.S. government puts a tariff of $100 per per tonne. tonne on aluminum from China. The tariff increases the price of aluminum from $300 to $ onsumers, and

Use the previous graph to complete the first row of the following table by indicating the quantity of aluminum supplied by U.S. producers, demanded by U.S. consumers, and imported from China under free trade. Quantity Demanded by U.S. Quantity Supplied by U.S. Producers Consumers Quantity Imported from China (Millions of tonnes of aluminum per (Millions of tonnes of aluminum per (Millions of tonnes of aluminum per month) month) month) Free Trade Trade with Tariff Suppose American aluminum manufacturers convince the U.S. government that Chinese firms are selling aluminum in the U.S. market at well below the cost of producing the aluminum, a practice known as dumping. In response to the accusations, the U.S. government puts a tariff of $100 per per tonne. tonne on aluminum from China. The tariff increases the price of aluminum from $300 to $ onsumers, and

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Q3: Using a domestic-market demand- and supply-curve graph, show the impact of tariff on a small country's import price, domestic demand, domestic supply, import quantity, consumer surplus, producer surplus, government revenue, and total welfare; Is the country unambiguously worse off as a result of the tariff? In the same graph, show how to achieve the same import quantity with an import quota; When would the tariff and the import quota lead to the same amount of welfare change? How will the answer to (a) and (b) change if the country uses a subsidy that is equivalent to the tariff rate to help domestic producers? How would the answers to (a) and (b) change for a large country? Your answer:
a) What is meant by terms of trade? b) How does a tariff on imports affect a country's terms of trade. Briefly explain (2-3 sentences expected).
The following table shows how many tonnes of dairy products and beef products can be produced in Country 1 and Country 2 with one unit of equivalent resources. Country 1 Country 2 Dairy Products (tonnes) 15 15 Beef Products (tonnes) 5 25 ..... a. Which country has an absolute advantage in dairy products? In beef products? Explain. Whoever is able to produce absolute advantage of producing that product. advantage in dairy production. production. with the same amount of resources has the has the absolute has the absolute advantage in beef A *****
The following graph shows the domestic demand for and supply of oranges in Guatemala. The world price (Pw) of oranges is $550 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) 820 790 760 730 700 670 640 610 580 550 520 0 Domestic Demand 1 Domestic Supply PW 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of oranges) A tariff set at this level would raise (~.) ? If Guatemala is open to International trade In oranges without any restrictions, it will import Suppose the Guatemalan government wants to reduce imports to exactly 60 tons of oranges to help…
Evaluate this statement: “If the United States imposed a uniform excise tariff on all foreign imports, all U.S. businesses and workers would benefit. Consequently, if a bill to impose a uniform excise tariff were introduced in the U.S. Congress, it would unanimously pass.”
Topic 3 Assignment The following graph shows the domestic supply of and demand for maize in Bangladesh. Bangladesh is open to international trade of maize without any restrictions. The world price (Pw) of maize is $245 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 maize and that there are no transportation or transaction costs associated with international trade in maize. 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. 470 Supply 420 305 X I I Demand I PRICE (Dollars perton) 445 245 720 D P W 40 80 120 150 200 240 280 320 350…
You are watching the nightly news. A political candidate being interviewed says, "I'm for free trade, but it must be fair trade. If our foreign competitors will not raise their environmental regulations, reduce subsidiaries to their export industries, and lower tariffs on their imports of our goods, we should retaliate with tariffs and import quotas on there goes to show them that we won't be played for fools!" A) If a foreign country artificially lowers the cost of production for its producers with lax environmental regulations and direct subsidiaries and then exports the products to us, who gains and who loses in our country, producers or consumers? B) Continuing form part A above, does our country gain or lose? Why? C) If a foreign country subsidizes the production of a good exported to the United States, who bears the burden of their mistaken policy? D) What happens to our overall economic well-being if we restrict trade with a country that subsidizes its export industries?…
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B1) Country A has 10 million workers and Country B has 20 million workers. Each worker in Country A can produce 2 units of wine and 4 units of fabric in a year. Each worker in Country B can produce 3 units of wine and 5 units of fabric in a year. a) Which country should import wine? Explain your answer. b) What is the range of trading prices (in terms of fabric) for wine between the two countries?
Economic Use the graph below and the following information to answer the next question. The world price of soybeans is five dollars per bushel and the importing country is small enough to not affect the real price. Suppose the government puts a tariff of one dollars per bushel on soybean imports how much revenue will the government raise from a one dollar per bushel tariff on soybean imports.
Suppose Zambia is open to free trade in the world market for soybeans. Because of Zambia's small size, the demand for and supply of soybeans in Zambia do not affect the world price. The following graph shows the domestic soybeans market in Zambia. The world price of soybeans is Pw = $400 per ton. Throughout this problem, assume that changes in trade policies in other nations do not significantly affect the world market for soybeans and that there are no transportation or transaction costs associated with international trade in soybeans. Also assume that domestic supplies will satisfy domestic demand as much as possible before any exporting or importing takes place. 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 domestic producer surplus (PS). PRICE (Dollars perton) 1200 Domestic Demand…
Use the Table below to answer Question 7: Imports Exports $2,132,000 $1,876,000 Capital per million dollars Labor (person-years) per million dollars Capital-labor ratio (dollars per worker) Average years of education per worker Proportion of engineers and scientists in work force 119 131 $17,916 $14,321 9.9 10.1 0.0189 0.0255 Source: Robert Baldwin, "Determinants of the Commodity Structure of U.S. Trade," American Economic Review 61 (March 1971), pp. 126–145. The above table illustrates factor content of U.S. exports and imports for 1962. Which of the following statement is true according to the above table? A. There is evidence supporting the Heckscher-Ohlin model. B. It shows that U.S. exports were more capital intensive than its imports. C. It shows that U.S. is a capital abundant country. D. It shows that the U.S. produces outside its PPF. E. None of the above is true. 7.