Suppose the world price for a good is 40 and the domestic

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Suppose the world price for a good is 40 and the domestic demand and supply cureves are given as:

Demand: P=80-2Q

Supply: P=5+3Q

A) How much is consumed?

B) How much is produced at home?

C) What are the values of consumer and producer surplus?

D) If a tariff of 10 percent is imposed, by how much do consumption and domestic production change?

E) What is the change in consumer and producer surplus?

F) How much revenue doe the government earn from the tariff?

G) What is the net national cost of the tariff?

Reference no: EM13378997

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