The steel industry has been lobbying for high taxes on imported steel. Russia, Brazil, and Japan have been produc- ing and selling steel on world markets at $610 per metric ton, well below what equilibrium would be in the United States with no imports. If no imported steel was permitted into the country, the equilibrium price would be $970 per metric ton. Show supply and demand curves for the United States, assuming no imports; then show what the graph would look like if U.S. buyers could purchase all the steel that they wanted from world markets at $610 per metric ton; show the quantity of imported steel.

The steel industry has been lobbying for high taxes on imported steel. Russia, Brazil, and Japan have been produc- ing and selling steel on world markets at $610 per metric ton, well below what equilibrium would be in the United States with no imports. If no imported steel was permitted into the country, the equilibrium price would be $970 per metric ton. Show supply and demand curves for the United States, assuming no imports; then show what the graph would look like if U.S. buyers could purchase all the steel that they wanted from world markets at $610 per metric ton; show the quantity of imported steel.

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.8P

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