Economics (MindTap Course List)
13th Edition
ISBN: 9781337617383
Author: Roger A. Arnold
Publisher: Cengage Learning
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Chapter 33, Problem 6QP
To determine
Effects of import tariff on exporters and import competitors.
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The demand for cameras in a certain country is given by D = 8000 – 30P, where P is the price of acamera. Supply by domestic camera producers is S = 4000 + 10P. If this economy opens to tradewhile the world price of a camera is $50, and the government imposes a tariff of $30 per camera,what will be the quantity of cameras that this country imports or exports?
Which of the choices describes how the effects of import tariffs and import quotas are different?
The domestic cost of an import tariff is larger than the domestic cost of a comparable import quota.
Import tariffs create deadweight loss, whereas import quotas do not create deadweight loss.
Quotas do not affect the equilibrium price, whereas tariffs do not affect the equilibrium quantity.
Some foreign producers receive some of the benefits generated by an import quota.
Potato SA's head of marketing Willie Jacobs has explained that the practice of potato dumping holds some harmful consequences. These include further economic decline and hitting where it hurts most, the livelihoods of South African farmers and workers and their families. He added that irregular imports are detrimental to a viable local economy; hence the implementation of consistent anti-dumping measures is essential." If demand theory is used to explain why South African farmers feel their businesses are under threat, it is because they believe that... A. They would have to sell their produce at a low price resulting in losses. B. They are expecting prices to rise in the future. C. There is not enough demand for potatoes in the market. D. The dumped potatoes shift the supply curve outwards resulting in price that is too high for consumers to afford.
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