PRICE (Dollars per ton) 1085 1030 975 920 865 810 755 0 50 100 150 W 200 250 300 350 400 450 500 QUANTITY (Tons of limes). If Zambia is open to international trade in limes without any restrictions, it will import Suppose the Zambian government wants to reduce imports to exactly 100 tons of limes to help domestic producers. A tariff of achieve this. A tariff set at this level would raise S in revenue for the Zambian government. tons of limes.
PRICE (Dollars per ton) 1085 1030 975 920 865 810 755 0 50 100 150 W 200 250 300 350 400 450 500 QUANTITY (Tons of limes). If Zambia is open to international trade in limes without any restrictions, it will import Suppose the Zambian government wants to reduce imports to exactly 100 tons of limes to help domestic producers. A tariff of achieve this. A tariff set at this level would raise S in revenue for the Zambian government. tons of limes.
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter34: Globalization And Protectionism
Section: Chapter Questions
Problem 55P: Assume two countries, Thailand (T) and Japan (J), have one good: cameras. The demand (d) and supply...
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Transcribed Image Text:PRICE (Dollars per ton)
1085
1030
975
920
865
810
755
0
50
100 150
W
200 250 300 350 400 450 500
QUANTITY (Tons of limes)
If Zambia is open to international trade in limes without any restrictions, it will import
Suppose the Zambian government wants to reduce imports to exactly 100 tons of limes to help domestic producers. A tariff of
achieve this.
A tariff set at this level would raise S
in revenue for the Zambian government.
tons of limes.
per ton will
Transcribed Image Text:4. Effects of a tariff on international trade
The following graph shows the domestic demand for and supply of limes in Zambia. The world price (Pw) of limes is $810 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 limes and that there are no transportation or transaction costs associated with international trade in limes.
Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place.
PRICE (Dollars per ton)
1305
1250
1195
1140
1065
1030
975
9.20
865
810
755
Domestic Demand
Domestic Supply
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