How much would the government collect in tariff revenues

Assignment Help Econometrics

Reference no: EM131253956

The domestic demand curve for portable radios is given by Q^d = 5000 - 100P, where Q^d is the number of radios that would be purchased when the price is P. The domestic supply curve for radios is given by Q^s = 150P, where Qs is the quantity of radios that would be produced domestically if the price were P. Suppose radios can be obtained in the world market at a price of $10 per radio. Domestic radio producers have successfully lobbied Congress to impose a tariff of $5 per radio.

a) Draw a graph illustrating the free trade equilibrium (with no tariff ). Clearly illustrate the equilibrium price.

b) By how much would the tariff increase producer surplus for domestic radio suppliers?

c) How much would the government collect in tariff revenues?

d) What is the deadweight loss from the tariff?

Reference no: EM131253956

Questions Cloud

What functions does social stratification serve : In your own words, define social stratification. What functions does social stratification serve? How do those in higher ranks use their status? What roles do myths, parables, etc., play in describing human condition?

Musician faces a monopolistic market : Assuming that the musician faces a monopolistic market (and wouldlike to maximise profits), how many music albums should he sell and atwhat price? Provide a mathematical solutions.

What is an entity relationship model and what is its purpose : What is enterprise data modeling? - What is an entity-relationship model and what is its purpose? What is data cleansing?

Design to create an organizational structure : Choose one of the organizational designs from the four and describe how you would use that design to create an organizational structure that would lead to high performance

How much would the government collect in tariff revenues : Domestic radio producers have successfully lobbied Congress to impose a tariff of $5 per radio.

Advantages and disadvantages of using the daas approach : What is Database as a Service (DaaS)? - What are the advantages and disadvantages of using the DaaS approach? - What is a schema and how is it used?

Basic definition of marginal cost and marginal productivity : What is the basic definition of marginal cost and marginal productivity?

What are secular trends and cohort effects in epidemiology : What are "secular trends" and "cohort effects" in epidemiology? What is the essential difference between the two? What are "temporal clustering" and "spatial clustering" in descriptive epidemiology?

What will be the resulting deadweight loss : Suppose that the supply curve in a market is upward sloping and that the demand curve is totally inelastic. In a free market the price is $30 per ton. If an excise tax of $2 per ton is imposed in the market, what will be the resulting deadweight l..

User Account

All Pages