ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
6th Edition
ISBN: 9781337408059
Author: William A. McEachern
Publisher: Cengage Learning
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Chapter 19, Problem 7P
To determine
The gains and losses to the economies of countries that deal in the export of sugar.
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PRICE (Dollars per ton)
4. Effects of a tariff on international trade
The following graph shows the domestic supply of and demand for soybeans in Honduras. The world price (Pw) of soybeans is $530 per ton and is
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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.
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Domestic Supply
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The following graph shows the domestic supply of and demand for oranges in Jordan. The world price (Pw) of oranges is $780 per ton and is
represented by the horizontal black line. Throughout the question, assume that 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 perton)
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Domestic Demand
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(Trade Restriction) The below 3 graphs show net losses to the economy of the country that imposed tariffs or quotas on imported sugar. What kinds of gains and losses would occur in the economies of countries that export sugar?
Chapter 19 Solutions
ECON MICRO (with MindTap, 1 term (6 months) Printed Access Card) (New, Engaging Titles from 4LTR Press)
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- 37 Domestic Demand PRICE (Dollars per tricycle) 1 200 360 QUANTITY (Tricycles) Domestic Supply World Price 520 Refer to the above figure. With trade, the price of tricycles in this country is $19, with 360 tricycles produced in this country and another 320 tricycles imported. $19, with 200 tricycles produced in this country and another 160 tricycles imported. $11, with 360 tricycles produced in this country and another 160 tricycles imported. $11, with 200 tricycles produced in this country and another 320 tricycles imported.arrow_forward(arguments of Trade Restrictions) Firms hurt by lower priced imports typically argue that restricting trade will save US jobs. What's wrong with this argument? Are there ever any reasons to support such trade restrictions?arrow_forward4. (20%) Depict on graph and briefly explain economic consequences of export tariff: · for exporters; for domestic consumers; for government budget; for national economic welfare as a whole.arrow_forward
- Price (dollars per ton) 1,000 800 600 400 200 0 1 2 3 4 5 D 6 Steel (millions of tons per year) The figure shows the market for steel in the United States. If the world price for a ton of steel is $200 per ton, how much steel does the United States import? Suppose the United States imposes a tariff of $400 per ton of steel. With this tariff, how much steel does the United States import? If it is possible to calculate the amount of the deadweight loss from the $400 per ton tariff, what is the amount? If it is not possible, explain why it is not possible to calculate it. Next suppose the United States imposes a tariff of only $200 per ton of steel. With this tariff, how much steel does the United States import? How much revenue does the government collect from this tariff? Finally, suppose that instead of a tariff the United States imposes a quota of 2 million tons of steel per year. Illustrate how the market changes with this quota. With the quota, what is the price of steel in the…arrow_forward8) 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.arrow_forwardPrice $22 $16 Home market S 10 14 22 I 26 D Quantity pw + 1 PW Who gains and who loses from the tariff in Home? To find out, determine the changes in consumer surplus (CS), producer surplus (PS) and tariff revenue as the country moves from free trade to the tariff equilibrium. Show the changes in the diagram and calculate the numerical values of them. (Ctrl)arrow_forward
- (Figure: Market for Pants) Suppose that the world price of a pair of pants is $40. According to the figure, international trade will lead to in the domestic producer surplus and in the domestic consumer surplus. Price 100 (Domestic supply 50 Domestic demand 50 100 Quantity of pants (in thousands) an increase; a decrease a decrease; a decrease a decrease; an increase an increase; an increasearrow_forward(choose the correct option) QUESTION 12 The volume of international trade: Has increased dramatically in the last few decades. Has increased slightly in the last few decades. Has decreased slightly in the last few decades Has decreased dramatically in the last few decades. All of the above.arrow_forward35. What is the solution to the political problem associated with international trade? (More than ONE answer) 36. Which of the following will significantly increase labor productivity? (More than ONE answer)arrow_forward
- 4.2. (International Trade) Distinguish between a tariff and a quota. Who benefits from and who is harmed by such restrictions on imports?arrow_forwardPlease help me with this carefully. Thank you.arrow_forward11) "Since countries generally gain from free trade, it is surprising that not everyone supports it." Discuss. (Word limit is 500 words)arrow_forward
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