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Take a look at the sugar market: US demand: Q=60-2/3 P US domestic supply: Q=P Also, the US could import any quantity from world producers at (US$) 10/cents per lb
a) In a scenario with free trade- what would be equilibrium price in US, also what would be consumer surplus and producer surplus?
b) Assume FDA changes its mind and opens her US to sugar imports; however the government wants to promote domestic sugar production by giving a subsidy of 15 cents/lb
What would be new equilibrium price and quantity?
How much is domestic produced and how much is imported?
What is new consumer surplus and producer surplus?
What is deadweight loss compared to the scenario in question a)?
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x=40-0.2p where x=x1+x2 c1=50+2x1+0.5x1 c2=100+10x2
TRADE IN SERVICES: India had objected to the inclusion of trade in services in the agreement for the UR negotiations. The Indian negotiations continued to raise object
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