Foundations of Economics (8th Edition)
8th Edition
ISBN: 9780134486819
Author: Robin Bade, Michael Parkin
Publisher: PEARSON
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Chapter 9, Problem 5IAPA
To determine
The gain from the import coffee and export of service is to be determined.
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In reference to tariffs, What is the reason that U.S. imposes tariffs? why the U.S. imposes tariffs on imports?
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[India is the world’s largest consumer of sugar. Assume the world price for sugar is $750 per ton.]
[Assume India currently has a tariff of $50 per ton on sugar and imports 7 million tons of sugar. Show this situation in a graph. Label the quantity demanded and the quantity supplied domestically and imports clearly on a graph. Explain your graph in 3-4 sentences.
How to draw the graph?
Chapter 9 Solutions
Foundations of Economics (8th Edition)
Ch. 9 - Prob. 1SPPACh. 9 - Prob. 2SPPACh. 9 - Prob. 3SPPACh. 9 - Prob. 4SPPACh. 9 - Prob. 5SPPACh. 9 - Prob. 6SPPACh. 9 - Prob. 7SPPACh. 9 - Prob. 8SPPACh. 9 - Prob. 9SPPACh. 9 - Prob. 10SPPA
Ch. 9 - Prob. 11SPPACh. 9 - Prob. 1IAPACh. 9 - Prob. 2IAPACh. 9 - Prob. 3IAPACh. 9 - Prob. 4IAPACh. 9 - Prob. 5IAPACh. 9 - Prob. 6IAPACh. 9 - Prob. 7IAPACh. 9 - Prob. 8IAPACh. 9 - Prob. 9IAPACh. 9 - Prob. 1MCQCh. 9 - Prob. 2MCQCh. 9 - Prob. 3MCQCh. 9 - Prob. 4MCQCh. 9 - Prob. 5MCQCh. 9 - Prob. 6MCQCh. 9 - Prob. 7MCQ
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- The united states is a big exporter of animals feeds, corn ,meat, fruits, vegetables and other agriculture commodities.Explain how foreign trade affects the domestic supply of such products.arrow_forwardWhen a country allows trade and becomes an importer of a good, which of the following is NOT a consequence? The price received by domestic producers of the good decreases. The gains of domestic consumers of the good exceed the losses of domestic producers of the good. The gains of domestic producers of the good exceed the losses of domestic consumers of the good. The price paid by domestic consumers of the good decreases.arrow_forwardDepict on graph and briefly explain economic consequences of export tariff: for domestic exporters; for domestic consumers; for government budget; for national economic welfare as a whole.arrow_forward
- What is the effect of placing tariffs on products imported into the U.S. from other countries? Are there any problems with this?arrow_forwardUS imports of sugar are subject to a quota. Although rounded up, the figures used in this exercise are close to reality. Thanks to the quota, US production of sugar is 6 million ton/year, instead of 5 million without the quota, and US consumption of sugar is 8 million ton/year, instead of 9 million without the quota. The US consumer pays $480/ton, whereas the world price is $280/ton. a) Easy: What is the volume of the quota? b) Easy: Why is the US price higher with the quota? c) Medium: Can you plot US supply and demand curves? Show graphically the impact of the quota for consumers and producers.arrow_forwardPrice $12 5 0 Korean Supply World Price Korean Demand Quantity of Shoes Refer to Figure 9-7. If trade in shoes is allowed, what action will Korea take? Korea will become an importer of shoes. Korea will become an exporter of shoes. Korea could become either an importer or an exporter of shoes. Korea will neither import nor export shoes.arrow_forward
- Why does the Philippines import rice from other countries even though rice can be produced in our countryarrow_forwardThe following figure represents a small country imposing a tariff against the imports of a good. The two horizontal line are the world price(pw) and the world price with tariffs (pw+t). The other two curves are the Home Supply Curve(upward slopping) and the Home Demand Curve(downward slopping). About this picture, what is true? 120 100 Price 60 80 60 00 40 30 20 Home Country 10 0 40 80 120 140 160 Demand Curve Supply Curve Pw Pw+tarrow_forwardSuppose India decides to remove the tariff, show the effect of this change on India’s imports on the graph. Clearly label the new domestic quantity demanded and the quantity supplied. You must use the same graph as you have drawn in answer to Part a to show this new scenario. How does this policy affect consumers, producers, and the government in India? You only have to state who benefits or harms from the policyarrow_forward
- The graph above is the U.S. market for some imported good. Supply is a flat curve. The U.S. can import the Chinese good for $40 and the Mexican good for $48. Assume the U.S. imposes $10 tariffs on each unit of the imported good. What will be the quantity imported? From which country? How your answer will change if the U.S. keep the $10 tariffs but join a trade bloc with Mexico? Will the country’s wellbeing increase or decrease? By how much (hint find the change in consumer surplus and the change in government revenue)? Explain your answers.arrow_forwardHow does a tariff on the import good affect a small country’s volume of trade, terms of trade and welfare? How do these effects compare with those of a large country? Explain your answer and use an offer curve diagram to illustrate your logic.arrow_forwardWhen a country opens for trade and becomes an exporter of a good, which of the following is a consequence? The gains of domestic consumers of the good exceed the losses of domestic producers of the good. The price received by domestic producers of the good decreases. The gains of domestic producers of the good exceed the losses of domestic consumers of the good. The price paid by domestic consumers of the good decreases.arrow_forward
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