Consider a hypothetical world consisting of only three countries: Hungary, Australia, and Italy. Each country produces grain. Hungary is a smalleconomy compared to Australia and Italy and thus cannot influence foreign prices.On the following graph, the supply and demand schedules of Hungary are shown as Sun and Dun. Foreign supply schedules of grain are perfectlyelastic: Australia is a more efficient supplier of grain than Italy because its supply price is $1.00 per bushel (SAus), whereas Italy's supply price is$2.00 per bushel (Sita).PRICE (Dollars)10.009.008.007.006.005.004.003.002.001.000HunS +TS₁ +TSS+0 3 6AScenarioFree tradeWith tariffWith customs unionmSHu12 15 18 21 24 27 30GRAIN (Thousands of bushels)Calculate the quantity of bushels Hungary imports when the three nations engage in free trade. Enter this value in the first row of the following table.Also indicate which country Hungary imports from.?Imports(Thousands of bushels) Imports from...

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Consider a hypothetical world consisting of only three countries: Hungary, Australia, and Italy. Each country produces grain. Hungary is a small economy compared to Australia and Italy and thus cannot influence foreign prices. On the following graph, the supply and demand schedules of Hungary are shown as Sun and Diun Foreign supply schedules of grain are perfectly elastic: Australia is a more efficient supplier of grain than Italy because its supply price is $1.00 per bushel (SA), whereas Italy's supply price is $2.00 per bushel (S). PRICE (Dollars) 10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0 ST S +T S S 036 9 12 15 18 21 24 27 GRAIN (Thousands of bushels) Calculate the quantity of bushels Hungary imports when the three nations engage in free trade. Enter this value in the first row of the following table. Also indicate which country Hungary imports from. Scenario Free trade With tariff With customs union 30 Imports (Thousands of bushels) Imports from... 000

Consider a hypothetical world consisting of only three countries: Hungary, Australia, and Italy. Each country produces grain. Hungary is a small economy compared to Australia and Italy and thus cannot influence foreign prices. On the following graph, the supply and demand schedules of Hungary are shown as Sun and Diun Foreign supply schedules of grain are perfectly elastic: Australia is a more efficient supplier of grain than Italy because its supply price is $1.00 per bushel (SA), whereas Italy's supply price is $2.00 per bushel (S). PRICE (Dollars) 10.00 9.00 8.00 7.00 6.00 5.00 4.00 3.00 2.00 1.00 0 ST S +T S S 036 9 12 15 18 21 24 27 GRAIN (Thousands of bushels) Calculate the quantity of bushels Hungary imports when the three nations engage in free trade. Enter this value in the first row of the following table. Also indicate which country Hungary imports from. Scenario Free trade With tariff With customs union 30 Imports (Thousands of bushels) Imports from... 000

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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Assume that the United States, as a steel-importing nation, is large enough so that changes in the quantity of its imports influence the world price of steel. The following table shows the U.S. supply and demand schedules for steel, along with the overall amount of steel supplied to U.S. consumers by domestic and foreign producers. Price (Dollars per ton) 100 200 300 400 PRICE (Dollars per ton) 800 700 600 500 400 300 200 100 500 600 700 0 0 2 Using the data in the table, use the blue points (circle symbol) to plot the demand curve and use the orange points (square symbol) to plot the supply curve (domestic plus imports) on the following graph. Then use the black cross to indicate the equilibrium price and quantity. ? 6 (Domestic) 0 0 1 2 3 5 Quantity Supplied The new equilibrium is (Domestic plus Imports) 0 8 10 12 14 16 18 20 QUANTITY (Tons of steel) With free trade, the equilibrium price of steel is $ 4 8 12 16 20 24 tons are supplied by U.S. producers, and tons are imported.…
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