The following graph shows the domestic supply of and demand for soybeans in Guatemala. The world price (Pw) of soybeans is $520 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 p 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. Domestic Supply 880 Domestic Demand 840 800 760 720 680 640 600 560 520 480 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Tons of soybeans) If Guatemala is open to international trade in soybeans without any restrictions, it will import| tons of soybeans. Suppose the Guatemalan government wants to reduce imports to exactly 40 tons of soybeans to help domestic producers. A tariff of $ per tor will achieve this. A tariff set at this level would raise $ in revenue for the Guatemalan government. PRICE (Dollars per ton)
The following graph shows the domestic supply of and demand for soybeans in Guatemala. The world price (Pw) of soybeans is $520 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 p 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. Domestic Supply 880 Domestic Demand 840 800 760 720 680 640 600 560 520 480 0 10 20 30 40 50 60 70 80 90 100 QUANTITY (Tons of soybeans) If Guatemala is open to international trade in soybeans without any restrictions, it will import| tons of soybeans. Suppose the Guatemalan government wants to reduce imports to exactly 40 tons of soybeans to help domestic producers. A tariff of $ per tor will achieve this. A tariff set at this level would raise $ in revenue for the Guatemalan government. PRICE (Dollars per ton)
Principles of Macroeconomics (MindTap Course List)
7th Edition
ISBN:9781285165912
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter9: Application: International Trade
Section: Chapter Questions
Problem 8PA
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