Question

In: Economics

The following graph shows the domestic supply of and demand for wheat in New Zealand. The...

4. Effects of a tariff on international trade 


The following graph shows the domestic supply of and demand for wheat in Bolivia. The world price (Pw) of wheat is $260 per bushel 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 price of wheat and that there are no transportation or transaction costs associated with international trade in wheat. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. 

image.png

If Bolivia is open to international trade in wheat without any restrictions, it will import _______ bushels of wheat.


Suppose the Bolivian government wants to reduce imports to exactly 200 bushels of wheat to help domestic producers. A tariff of $_______  per bushel  will achieve this. 


A tariff set at this level would raise $_______  in revenue for the Bolivian government.

Solutions

Expert Solution

It will import 450-50= 400 bushels of wheat.
At P= 310, imports = 350-150= 200

A tariff of 310-260= 50

Revenue = 50*200= 10000

Rahul Sunny answered 2 years ago
Next > < Previous

Related Solutions

The following graph shows the domestic supply of and demand for wheat in Bolivia. The world...
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for wheat in Bolivia. The world price (Pw) of wheat is $265 per bushel 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 price of wheat and that there are no transportation or transaction costs associated with international trade in wheat. Also, assume that domestic suppliers will satisfy domestic...
The following graph shows the domestic supply of and demand for soybeans in Zambia
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for soybeans in Zambia. The world price (Pw) of soybeans is $525 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 price of soybeans and that there are no transportation or transaction costs associated with international trade in soybeans. Also, assume that domestic suppliers will...
​ The following graph shows the domestic supply of and demand for maize in Bangladesh.
The following graph shows the domestic supply of and demand for maize in Bangladesh. The world price (Pw) of maize is $260 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 price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible...
The following graph shows the domestic supply of and demand for oranges in Zambia
4. Effects of a tariff on international tradeThe following graph shows the domestic supply of and demand for oranges in Zambia. The world price (PWPW) of oranges is $780 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 price of oranges and that there are no transportation or transaction costs associated with international trade in oranges. Also, assume that domestic suppliers will...
4. Effects of a tariff on international trade The following graph shows the domestic supply of...
4. Effects of a tariff on international trade The following graph shows the domestic supply of and demand for wheat in Bolivia. The world price (Pw) of wheat is $245 per bushel 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 price of wheat and that there are no transportation or transaction costs associated with international trade in wheat. Also, assume that domestic suppliers will...
14. Application: Demand elasticity and agriculture Consider the market for wheat. The following graph shows the...
14. Application: Demand elasticity and agriculture Consider the market for wheat. The following graph shows the weekly demand for wheat and the weekly supply of wheat. Suppose new farming technology is developed that enables growers to produce more crops with the same resources. Show the effect this shock has on the market for wheat by shifting the demand curve, supply curve, or both. Note: Select and drag one or both of the curves to the desired position. Curves will snap...
The graph shows the market for tutoring at a university. A graph plots demand and supply...
The graph shows the market for tutoring at a university. A graph plots demand and supply curves with Quantity (hours of tutoring per week) along the horizontal axis and Price (per hour of tutoring) along the vertical axis. The supply curve starts at 2.50 dollars on price and has a positive slope. The demand curve starts at 25 dollars on price and has a steep negative slope. The curves intersect at 300 hours on quantity, 10 dollars on price. The...
Draw a graph that shows how each of the following events will affect the demand, supply,...
Draw a graph that shows how each of the following events will affect the demand, supply, equilibrium price, and equilibrium quantity of compact discs. Note: Be sure to identify whether or not the demand and supply curves shift, or whether you are moving along the demand and supply curves. Assume that the average price of CD is $20 and that 100,000 CDs are sold each week. a. The price of DVD audio discs decreases (DVD audio discs can be played...
​The following graph shows the supply of a good.
The following graph shows the supply of a good. For each of the regions, use the midpoint method to identify whether the supply of this good is elastic or inelastic. True or False: For high levels of quantity supplied where firms have reached near maximum capacity, supply becomes less elastic because firms may need to invest in additional capital in order to increase production further. True False
The following graph shows the supply of a good.
The following graph shows the supply of a good.For each of the regions, use the midpoint method to identify whether the supply of this good is elastic or inelastic. True or False: For high levels of quantity supplied where firms have reached near maximum capacity, supply becomes more elastic because firms may need to invest in additional capital in order to further increase production.
ADVERTISEMENT
Subjects
ADVERTISEMENT
Latest Questions
ADVERTISEMENT