This question is about quantifying the effects of removing a country's tariff on sugar. The following...

This question is about quantifying the effects of removing a country's tariff on sugar. The following table shows how many pounds of sugar would be produced, consumed and imported by the country if there were no sugar duty.

	Situation with Import tariff	Estimated situation without tariff
World Price	$0.10 per pound	$0.10 per pound
Tariff	$0.02 per pound	0
Domestic price	$0.12 per pound	$0.10 per pound
Domestic consumption	20	22
Domestic production	8	6
Import	12	16

Answer the next 4 question based on this table.

What is the domestic consumers' gain from removing the tariff?

What is the domestic producers' loss from removing the tariff?

What is the government tariff revenue loss?

What is the net effect on national well-being?

Solutions

Expert Solution

Rahul Sunny answered 1 year ago

Next > < Previous

Related Solutions

You have been asked to quantify the effects of removing a country's tariff on sugar. The...

You have been asked to quantify the effects of removing a country's tariff on sugar. The hard part of the work is already done. Somebody has estimated how many pounds of sugar would be produced, consumed, and imported by the country if there were no sugar duty. You are given the information shown in the table. Situation with import tariff estimated situation w/o tariff World price $.10 per pound $.10 per pound Tariff $.02 per pound $0 Domestic Price $0.12...

Question 2 (a) Discuss an optimum tariff as a concept. (b) Discuss and compare the effects...

Question 2 (a) Discuss an optimum tariff as a concept. (b) Discuss and compare the effects of a voluntary export restraint. (c) Explain and evaluate dumping as a trade measure, especially taking into account who pays or benefits from dumping.

Compare and contrast the effects of a tariff in a smaller nation with the effects of...

Compare and contrast the effects of a tariff in a smaller nation with the effects of a quota, using welfare economics as your analytical approach. Which is the more effective approach if a nation wishes to retain as much value as is possible within its own borders?

Suppose USA is a small country in sugar market. At present, there is no tariff on...

Suppose USA is a small country in sugar market. At present, there is no tariff on sugar import. However, beginning January 2015, the U.S. government starts levying 10 % tariff on sugar import. Using an appropriate graphs explain what happens in the U.S. sugar market? Who gains, who loses and what will be overall welfare effect?

Explain the economic effects of a tariff using the market model. Who pays the tariff?

1.Reducing tariff rates will not improve a country's growth if A. goods cannot enter or exit...

1.Reducing tariff rates will not improve a country's growth if A. goods cannot enter or exit the country easily due to insufficient transportation networks. B. the country has low levels of corruption. C. levels of technology in the country are low. 2.Which of the following policies is most likely to reduce the amount of child labor used in developing countries? A. Developed countries subsidizing their agricultural industries. B.Developing countries preventing farmers from exporting agricultural goods. C. Developing countries requiring children...

what good Japan and US trade and what is developed country's tariff policy on this good...

what good Japan and US trade and what is developed country's tariff policy on this good and how this impacts the business sector in developing country producing that good ?

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...

Explain, the effects of a tariff in a large vs. a small importing economy.

This question is designed to inspire you to think about the effects of COVID19 on the...

This question is designed to inspire you to think about the effects of COVID19 on the management of a commercial bank. Suppose a bank’s original T-account is de- picted as follows: Table 1: T-Account for Bank A in February 2020 Assets Liabilities plus Equity Loans: $ 800 Deposits: $1200 Securities: $ 400 Borrowings: $400 Reserves: $ 600 Equity: ? The interest rate on loans is 8%, the average return for securities is 5%, the interest rate on reserves is 2%,...

Subjects