Question 21 Suppose supply is given by P = 2Q and demand is given by P = 1000 - 2Q. What will happen in this economy if the world price is 400? An export of 100 units An import of 100 units An import of 200 units An export of 200 units
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- Explain how a tariff reduction causes an Increase in the equilibrium quantity of imports and a decrease in the equilibrium price. Hint: Consider the Work It Out Effects of Trade Barriers.Explain how a subsidy on agricultural goods like sugar adversely affects the income of foreign producers of imported sugar.The nation of Bermuda is “small” and assumed to be unable to affect world prices. The Domestic Supply and Domestic Demand curvesfor boxes are:S = 60 + 20PD = 1160 − 15P(a) Assume Bermuda is Completely open to trade. What is the equilibrium price and quantityconsumed?
- ALL QUESTIONS APPLY TO GRAPH 23. What quantity will Country B supply from the rest of the world at P=$12? 24. The international equilibrium price is $______. 25. What will be the quantity traded?The nation of Bermuda is “small” and assumed to be unable to affect world prices. It importsstrawberries at the price of 10 dollars per box. The Domestic Supply and Domestic Demand curvesfor boxes are:S = 60 + 20PD = 1160 − 15P(a) if the import quota is 400 boxes then what is new equilibrium price.The nation of Bermuda is “small” and assumed to be unable to affect world prices. It importsstrawberries at the price of 10 dollars per box. The Domestic Supply and Domestic Demand curvesfor boxes are:S = 60 + 20PD = 1160 − 15P(a) Assume Bermuda is Completely open to trade. What is the equilibrium price and quantityconsumed?
- Suppose you have the following for white t-shirts market:Market demand is P=125-(3/8)QMarket supply is P=5+(1/8)Q. Suppose it is now possible to obtain white t-shirts from the rest of the world at $15 per item at anygiven quantity. In other words, there is now a global supply that is horizontal at $15.a. Obviously the world price and domestic price will now be $15. Calculate the quantityproduced and demanded domestically. Calculate the difference as imports from the rest of theworld.b. Calculate the CS (Consumer Surplus) and PS (Producer Surplus) under free trade. Who gainswith free trade? Who loses?Hint: Use graphs first.The nation of Bermuda is “small” and assumed to be unable to affect world prices. It importsstrawberries at the price of 10 dollars per box. The Domestic Supply and Domestic Demand curvesfor boxes are:S = 60 + 20PD = 1160 − 15P(a) Assume Bermuda is Completely open to trade. What is the equilibrium price.The demand for cameras in a certain country is given by D=8000−30P, where P is the price of a camera. Supply by domestic camera producers is S=4000+10P. Suppose that world price of a camera is $150. If this country decides to trade, which of the following is true? Group of answer choices 3000 cameras will be exported Domestic production of cameras will decrease by 500 Domestic production of cameras will increase by 500 2000 cameras will be imported
- Suppose that the current international price of wheat is $6 per bushel and that the United States is currently exporting 30 million bushels per year. If the United States suddenly became a closed economy with respect to wheat, would the domestic price of wheat in the United States end up higher or lower than $6? a. Higher. b. Lower. c. The same.Offer curves tell usa) The demand and supply of both goods at different relative pricesb) The demand for import good only at different relative prices.c) The supply of export good at different relative prices.d) None of the above.Domestic Demand Function: p= 80-4Q Domestic Supply Function: p= 20+2.5Q There is an international trade price equal to $30 (pw=30) What will the new Domestic Demand of books be?. What will be the new Domestic production for books be? What quantity of books will be mportd or exported?