Find the trading price for petroleum

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Reference no: EM131953825

1. Suppose the domestic supply and demand curves for petroleum in the U.S. are,

Qs = 10P - 300

Qd = 3000 - 20P

Let the world trade price be $50 per barrel.

1) What is the equilibrium quantity of imports?

2) Suppose a specific tariff of $10 per barrel is imposed. Calculate Consumer surplus, producer surplus, and tariff revenue.

3) Suppose the government imposes an import quota of 1200 units of barrels. Find the trading price for petroleum.

Reference no: EM131953825

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