Could you answer numbers 4, 5, and 6? Effects of Free Trade and RestrictionsUse the graph below to answer the following questions:Price$11.00$7.50$6.00$4.0046.9.1215QuantityThe graph above shows the demand and supply of wrenches for the country of Spain.1. If trade is avoided, Spain consumeswrenches at a price ofper wrench.2. With free trade, for a world price of $4 per wrench, Spain is producingwrenches.3. With free trade, for a world price of $4 per wrench, Spain is consumingwrenches.4. With free trade, for a world price of $4 per wrench, Spain is importingwrenches.5. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain producesand importswrenches.6. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain's government collect?

Equilibrium is achieved at the output level where quantity demanded equals quantity supplied.

The graph above shows the demand and supply of wrenches for the country of Spain. 1. If trade is avoided, Spain consumes wrenches at a price of per wrench. wrenches. 2. With free trade, for a world price of $4 per wrench, Spain is producing 3. With free trade, for a world price of $4 per wrench, Spain is consuming wrenches. 4. With free trade, for a world price of $4 per wrench, Spain is importing wrenches. 5. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain produces and imports 6. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain's government collect? wrenches.

The graph above shows the demand and supply of wrenches for the country of Spain. 1. If trade is avoided, Spain consumes wrenches at a price of per wrench. wrenches. 2. With free trade, for a world price of $4 per wrench, Spain is producing 3. With free trade, for a world price of $4 per wrench, Spain is consuming wrenches. 4. With free trade, for a world price of $4 per wrench, Spain is importing wrenches. 5. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, Spain produces and imports 6. If the world price is $4 per wrench, and the government of Spain imposes a tariff of $2, how much tariff revenue will the Spain's government collect? wrenches.

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter28: International Trade

Section: Chapter Questions

Problem 15P

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Similar questions

From the Work It Out Effects of Trade Barriers, you can see that a tariff raises the price of imports. What is interesting is that the price rises by less than the amount of the tariff. Who pays the rest of the tariff amount? Can you show this graphically?
Trade has income distribution effects. For example, suppose that because of a government-negotiated reduction in trade barriers, trade between Germany and the Czech Republic increases. Germany sells house paint to the Czech Republic. The Czech Republic sells alarm clocks to Germany. Would you expect this pattern of trade to increase or decrease jobs and wages in the paint industry in Germany? The alarm clock industry in Germany? The paint industry in Czech Republic? The alarm clock industry in Czech Republic? What has to happen for there to be no increase in total unemployment in both countries?
If opening up to free trade would benefit a nation, then why do nations not just eliminate their trade barriers, and not bother with international trade negotiations?
How do trade barriers affect the average Income level in an economy?
In Japan, one worker can make 5 tons of rubber or 80 radios. In Malaysia, one worker can make 10 tons of rubber or 40 radios. Who has the absolute advantage in the production of rubber or radios? How can you tell? Calculate the opportunity cost of producing 80 additional radios in Japan and in Malaysia. (Your calculation may involve fractions, which is fine,) Which country has a comparative advantage in the production of radios? Calculate the opportunity cost of producing 10 additional tons of rubber in Japan and in Malaysia. Which country has a comparative advantage in producing rubber? In this example, does each country have an absolute advantage and a comparative advantage in the same good? In what product should Japan specialize? In what product should Malaysia specialize?