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nduras allows interrational trade in the market for soybeans, it will import tons of soybeans. suppose the Honduran government decides to impose a tariff of $200 on each imported ton of soybeans. After the tariff, the price Honduran umers pay for a ton of soybeans is $ , and Honduras will import tons of soybeans.

nduras allows interrational trade in the market for soybeans, it will import tons of soybeans. suppose the Honduran government decides to impose a tariff of $200 on each imported ton of soybeans. After the tariff, the price Honduran umers pay for a ton of soybeans is $ , and Honduras will import tons of soybeans.

Principles of Microeconomics (MindTap Course List)
Principles of Microeconomics (MindTap Course List)
8th Edition
ISBN:9781305971493
Author:N. Gregory Mankiw
Publisher:N. Gregory Mankiw
Chapter9: Application: International Trade
Section: Chapter Questions
Problem 3CQQ
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If Honduras allows interr.ational trade in the market for soybeans, it will import tons of soybeans. Now suppose the Honduran government decides to impose a tariff of $200 on each imported ton of soybeans. After the tariff, the price Honduran consumers pay for a ton of soybeans is $ and Honduras will import tons of soybeans.
Transcribed Image Text:If Honduras allows interr.ational trade in the market for soybeans, it will import tons of soybeans. Now suppose the Honduran government decides to impose a tariff of $200 on each imported ton of soybeans. After the tariff, the price Honduran consumers pay for a ton of soybeans is $ and Honduras will import tons of soybeans.
3. Welfare effects of a tariff in a small country Suppose Ronduras is open to free trade in the world market for soybeans. Because of Honduras's small size, the demand for and supply of soybeans in Honduras do not affect the world price. The following graph shows the domestic soybeans market in Honduras. The world price of soybeans is Pw = $400 per ton. On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at the free-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing producer surplus (PS). 1200 Domestic Demand Domestic Supply 1100 CS 1000 900 PS 800 700 600 500 400 300 200 100 120 140 160 180 200 20 40 60 80 QUANTITY (Tons of soybeans) PRICE (Dollars pe: ton)
Transcribed Image Text:3. Welfare effects of a tariff in a small country Suppose Ronduras is open to free trade in the world market for soybeans. Because of Honduras's small size, the demand for and supply of soybeans in Honduras do not affect the world price. The following graph shows the domestic soybeans market in Honduras. The world price of soybeans is Pw = $400 per ton. On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at the free-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing producer surplus (PS). 1200 Domestic Demand Domestic Supply 1100 CS 1000 900 PS 800 700 600 500 400 300 200 100 120 140 160 180 200 20 40 60 80 QUANTITY (Tons of soybeans) PRICE (Dollars pe: ton)
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