Suppose country B is a small export country (price taker) in the world market of lamp trade. Its domestic demand on and supply for lamp are: D=18-P, S=-12+2P. The world market price of lamp is 14. (a) Calculate the equilibrium price and quantity of lamp in country B before trade. (c) Calculate B’s quantity of exported lamp under free trade. (c)Draw graph and calculate the net welfare effect of free trade on B’s consumers
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Suppose country B is a small export country (price taker) in the world market of lamp trade. Its domestic demand on and supply for lamp are: D=18-P, S=-12+2P. The world market price of lamp is 14.
(a) Calculate the
(c) Calculate B’s quantity of exported lamp under free trade.
(c)Draw graph and calculate the net welfare effect of free trade on B’s consumers, producers and the whole country.
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- ЕОC 10.05 Japan imports crayons into its country; they are a price taker in this market. Suppose the world price of crayons is $5. If Japan imposes a $1 tariff on crayons, what would be the domestic price of crayons and what will happen to the quantity bought? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. a The quantity bought will increase and the price will be $6. b The quantity bought will fall and the price will be $6. The quantity bought will fall and the price will be $4. d. The quantity bought will increase and the price will be $4.Assume that you have been hired by an International Organization to be consulted on variousissues that the country Motherland faces. For this exercise, assume that Motherland is a smallagricultural economy. (a) Motherland imports electronics from the United States. The government of Motherland is considering to impose quotas on these electronics imports coming from the United States. Would you recommend it? Explain your answer. In your explanation, distinguish the effect on the consumers of electronics, the domestic producers of electronics and the government. (b)The government of Motherland wants to jump start industrial production. Over time the main objective is to convert this agricultural economy into an industrial nation. On the basis of the experiences of Argentina and Singapore, what policies would you suggest?The following graph shows the U.S. domestic market for towels. PRICE (Dolars) Domestic Demand Domestic Supply 24 72 1.20 QUANTITY (Millions of towels) Price (World) Price (Quota) (7) In the absence of foreign trade, the equilibrium price of a towel is domestic quantity supplied equal million towels. At this price, both the domestic quantity demanded and the Suppose that trade between the United States and China is open and that the United States initially imposes no tariffs or quotas on towels imported from China. Assume that China has a comparative advantage in producing towels and charges the world price of $12 per towel. (Note: Throughout the problem, assume that the amount demanded by any one country does not affect the world price of towels.) On the previous graph, use the grey line (star symbol) to indicate the world price of towels. million towels, the quantity of towels supplied by At the world price of $12 per towel, the quantity of towels demanded by U.S. buyers is U.S.…
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- QUESTION 6 The following figure depicts the supply and demand schedules of calculators for Greece, a "small" country that is unable to affect the world price. Greece's supply and demand schedules of calculators are respectively depicted by SG and DG Assume that Greece imports calculators from either Germany or France. Suppose Germany is the world's low-cost producer who can supply calculators to Greece at $20 per unit, while France can supply calculators at S30 per unit. Queny f Cako Referring to the above figure, suppose Greece forms a customs union with France. Greece will import: a. 3 calculators at a per-unit price of $40 b.3 calculators at a per-unit price of $30 c.6 calculators at a per-unit price of $30 d.6 calculators at a per-unit price of $40Quantity Supplied Domentically Jerice Domestically Quantity Demanded 1,400 $10 2,200 1,600 9. 2,000 1,800 1,800 2,000 7. 1,600 2,200 6. 1,400 2,400 1,200 Refer to the accompanying table for a certain product's market in Econland, the world price of the product were $6 and a tariff of $t per unit were applied to imports of the product, then the tariff would generate government revenues of Mutple Choice $400 S1200 S600 S000Finland imports shoes into its country; they are a price taker in this market. Suppose the world price of shoes is $40. If Finland imposes a $10 tariff on shoes, what would be the domestic price of shoes and what will happen to the quantity bought? Select an answer and submit. For keyboard navigation, use the up/down arrow keys to select an answer. The quantity bought will increase and the price will be $30. a The quantity bought will fall and the price will be $30. The quantity bought will fall and the price will be $50. The quantity bought will increase and the price will be $50.