A The left graph depicts the domestic market for a small country's product, and the right graph represents the word market. 1. Draw and label the MD curve in the world market on the right. Be precisethere is only one correct answer. In other words, don't just draw some random line. 2. Label the Quantity of imports on both graphs. How are the graphs related? 3. sutline CS and PS under free trade. Don't worry if the graph "cuts off" Suppose now that this country wishes to cut the quantity of imports in half. 4 Draw the appropriate tariff (there is only one correct price increase to achieve a specifie reduction in quantity) and the new world price. You need M to be exactly half of what it was. 5. In BLACK, label and color any tranafers from one group to another. Draw this only on the correct graph(a). There is no PS on the right graph, for example. 6. In BLUE, label and solor any Deadweight loss and Government revenue on both grapha. P XS D

A The left graph depicts the domestic market for a small country's product, and the right graph represents the word market. 1. Draw and label the MD curve in the world market on the right. Be precisethere is only one correct answer. In other words, don't just draw some random line. 2. Label the Quantity of imports on both graphs. How are the graphs related? 3. sutline CS and PS under free trade. Don't worry if the graph "cuts off" Suppose now that this country wishes to cut the quantity of imports in half. 4 Draw the appropriate tariff (there is only one correct price increase to achieve a specifie reduction in quantity) and the new world price. You need M to be exactly half of what it was. 5. In BLACK, label and color any tranafers from one group to another. Draw this only on the correct graph(a). There is no PS on the right graph, for example. 6. In BLUE, label and solor any Deadweight loss and Government revenue on both grapha. P XS D

Principles of Economics 2e

2nd Edition

ISBN:9781947172364

Author:Steven A. Greenlaw; David Shapiro

Publisher:Steven A. Greenlaw; David Shapiro

Chapter23: The International Trade And Capital Flows

Section: Chapter Questions

Problem 19SCQ: Describe a scenario in which a trade surplus benefits an economy and one in which a trade surplus is...

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