Econ Micro (book Only)
6th Edition
ISBN: 9781337408066
Author: William A. McEachern
Publisher: Cengage Learning
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Question
Chapter 19, Problem 6P
A
To determine
The net gains and losses that each of the stakeholders face while imposing the trade restrictions
B
To determine
The deadweight loss.
C
To determine
The response for such policies from various industries that use U.S steel.
D
To determine
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8) Suppose the United States imposes a tariff or quota on sugar imports. For each of the following, enter the letter G ifit will gain from the tariff or quota or enter the letter L if it will lose from the tariff or quota.Domestic sugar producers and their workers _______Consumers _______Industries that use sugar and their workers _______9) _______________ are goods and services produced domestically but sold to other countries. _______________ are goods and services bought domestically but produced in other countries._______________ are taxes imposed by a government on imports of a good into a country.
a,Tarrifs
b, exports
c,quotas
D,Imports
10) Which of the following are non-tariff barriers to trade?National security grounds.Health and safety requirements.Embargoes.All of the above.
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- Assume a perfectly competitive market and the exporting country is small. Using a demand and supply diagram, show the impact of increasing standards on a low-income exporter of toys. Show the tariffs impact. Is the effect on toy prices the same or different? Why is a standards policy preferred to tariffs?arrow_forwardExplain how a subsidy on agricultural goods like sugar adversely affects the income of foreign producers of imported sugar.arrow_forward2. Uganda is a small of Uganda country. The government wants to protect domestic producers of rice by imposing a quota, an ad valorem tariff or an equivalent specific tariff. The three trade barriers would be equivalent in the sense that either one will initially limit imports to a given amount. Once either of these measures is imposed, the government will not switch to a different measure or change its magnitude. Suppose the world supply of rice (relative to the world demand for rice) is expected to increase in the future. You are a lobbyist for producers of rice in Uganda and you only care about their interests. Which trade barrier would you advocate on their behalf - a quota, an ad valorem tariff, or a specific tariff? Which one would you advocate next? Explain carefully using a numerical example. (Feel free to use a graph as well if you want.) (Consider ONLY the interests of PRODUCERS of rice in Uganda.)arrow_forward
- 3 1190 Domestic Demand E 1140 1090 PRICE (Dollars per ton) 1040 990 940 890 840 790 740 690 0 10 20 + I 1 1 R 30 40 50 60 70 QUANTITY (Tons of limes) A tariff set at this level would raise $ F If Zambia is open to international trade in limes without any restrictions, it will import % Domestic Supply 5 T Suppose the Zambian government wants to reduce imports to exactly 40 tons of limes to help domestic producers. A tariff of achieve this. G 1 I 6 P. 80 90 100 W Y in revenue for the Zambian government. H & 7 ? U 8 00 J tons of limes. Grade It Now 9 K O per ton will Save & Continue Continue without eaving O Parrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forwardPlease help me with this carefully. Thank you.arrow_forward
- Nonearrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward8. The arguments for restricting trade Suppose there is a policy debate regarding the United States imposing trade restrictions on imported tires: A congresswoman from a state with several tire factories argues that the government should impose a tariff on tires because they are a necessary input into the production of various weapons. Free trade would make the United States overly dependent on foreign countries for the supply of tires. In case of a war, the United States might not be able to make or purchase enough tires and, therefore, would not be able to make enough weapons to defend itself. Which of the following justifications is the congresswoman using to argue for the trade restriction on tires? O Saving domestic jobs argument O Low foreign wages argument O National defense argument O Infant industry argument O Foreign export subsidies argumentarrow_forward
- Q4. The supply S and demand D for sugar in US are: S = 3500 + 6.2P D = 10500 – 3.8P where P is the price of sugar (in tons) and S and D are in thousand tons. The world price is 300 $/ton. Assume that the US is a small country in the sugar market. (a) If there was free trade, how much sugar would the United States import from the rest of the world?arrow_forwardNote:- Do not provide handwritten solution. Maintain accuracy and quality in your answer. Take care of plagiarism. Answer completely. You will get up vote for sure.arrow_forward1. Consider Figure 1 (see next page) representing a market demand for a product, the marginal cost of a domestic monopolist (there is only one firm producing this product in the Home country) and the world price of the same product (there are many firms producing it in other countries). (i) What is the domestic price, the domestic production and imports in free trade? (ii) Now suppose there is a tariff t so that the domestic price is p" +t (such that there is still some imports). What is then the domestic production and imports? (iii) Suppose now that instead of a tariff t, a quota is introduced having the characteristic that the number of units imported is the same as the import level with the tariff t. What is the domestic price, the domestic production and imports with such a quota? (iv) Compare the levels of welfare with the tariff and with the quota.arrow_forward
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