A company imports a product from China with a cost of $50 per unit. The product is imported with an import tariff of 20% and it is sold for $100 per unit. The total sale revenues for the company were 85.000. If the government increases the import tariff per unit of the product to 30% and the elasticity of demand is 3 find the following: (i) (ii) How many units of this product the company will sale if the price rise the same amount with the import tariff Calculate if the revenues of the company will increase or decrease with the increase of import tariff
A company imports a product from China with a cost of $50 per unit. The product is imported with an import tariff of 20% and it is sold for $100 per unit. The total sale revenues for the company were 85.000. If the government increases the import tariff per unit of the product to 30% and the elasticity of demand is 3 find the following: (i) (ii) How many units of this product the company will sale if the price rise the same amount with the import tariff Calculate if the revenues of the company will increase or decrease with the increase of import tariff
Microeconomics: Principles & Policy
14th Edition
ISBN:9781337794992
Author:William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:William J. Baumol, Alan S. Blinder, John L. Solow
Chapter16: Externalities, The Environment, And Natural Resources
Section: Chapter Questions
Problem 4DQ
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 1 images
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, economics and related others by exploring similar questions and additional content below.Recommended textbooks for you
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax
Microeconomics: Principles & Policy
Economics
ISBN:
9781337794992
Author:
William J. Baumol, Alan S. Blinder, John L. Solow
Publisher:
Cengage Learning
Principles of Economics 2e
Economics
ISBN:
9781947172364
Author:
Steven A. Greenlaw; David Shapiro
Publisher:
OpenStax