The following graph shows the domestic supply of and demand for maize in Burundi. The world price (Pw) of maize is $260 per ton and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. ? 530 Domestic Demand Domestic Supply 500 470 440 410 380 350 320 270, 260 290 Pw 260 230 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of maize) PRICE (Dollars per ton)
The following graph shows the domestic supply of and demand for maize in Burundi. The world price (Pw) of maize is $260 per ton and is represented by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of maize and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy domestic demand as much as possible before any exporting or importing takes place. ? 530 Domestic Demand Domestic Supply 500 470 440 410 380 350 320 270, 260 290 Pw 260 230 30 60 90 120 150 180 210 240 270 300 QUANTITY (Tons of maize) PRICE (Dollars per ton)
Principles of Economics 2e
2nd Edition
ISBN:9781947172364
Author:Steven A. Greenlaw; David Shapiro
Publisher:Steven A. Greenlaw; David Shapiro
Chapter34: Globalization And Protectionism
Section: Chapter Questions
Problem 57P: The country of Pepperland exports steel to the Land of Submarines. Information for the quantity...
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Transcribed Image Text:If Burundi is open to international trade in maize without any restrictions, it will import
tons of maize.
Suppose the Burundian government wants to reduce imports to exactly 120 tons of maize to help domestic producers. A tariff of $
per ton will
achieve this.
A tariff set at this level would raise $
in revenue for the Burundian government.
Transcribed Image Text:The following graph shows the domestic supply of and demand for maize in Burundi. The world price (Pw) of maize is $260 per ton and is represented
by the horizontal black line. Throughout the question, assume that the amount demanded by any one country does not affect the world price of maize
and that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfy
domestic demand as much as possible before any exporting or importing takes place.
530
Domestic Demand
Domestic Supply
500
470
440
410
380
350
320
270, 260
290
260
230
30
60
90
120
150
180
210
240
270
300
QUANTITY (Tons of maize)
PRICE (Dollars per ton)
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