EBK ECONOMICS: PRINCIPLES AND POLICY
13th Edition
ISBN: 8220100605932
Author: Blinder
Publisher: Cengage Learning US
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Chapter 35, Problem 4DQ
To determine
The long-term and short-term effects of removing quota.
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Which of the following would benefit producers, harm consumers and reduce total surplus?
Opening of a market to trade when the world price is lower than the domestic price.
Decrease of a subsidy.
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Increase of a tariff.
None of these.
The domestic supply and demand curves for hula beans are as follows: P = 50 + Q (supply) and P = 200 – Q (demand) where P is the price in cents per pound and Q is the quantity in millions of pounds. Ireland is a small producer in this market where the current price is 60 cents per pound. The Irish Government is considering a tariff of 40 cents per pound.
The quantity of hula beans imported into Ireland after the tariff is A. 100B. 50C. 130D. 90
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Chapter 35 Solutions
EBK ECONOMICS: PRINCIPLES AND POLICY
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- Using demand and supply, illustrate the effects of a quota imposed by the Canadian government on US wheat . Show the US wheat market and the Canadian wheat market.arrow_forwardThe domestic supply and demand curves for hula beans are as follows: P = 20 + Q (supply) and P = 250 – Q (demand) where P is the price in cents per pound and Q is the quantity in millions of pounds. Ireland is a small producer in this market where the current price is 50 cents per pound. The Irish Government is considering a tariff of 50 cents per pound. The increase in producer surplus after the tariff has been imposed is equal to A. 2750 B. 4000 C. 2500 D. 1500arrow_forwardIndicate which of these are a reason that market inefficiencies persist? Check all that apply. Inefficiencies are undiscovered Inefficiencies are undiscovered New technology New technology Lowering of transaction costs Lowering of transaction costs Inefficiencies seem rational Inefficiencies seem rational Influx of foreign investors Influx of foreign investors Demographic factors Demographic factors Inefficiencies seem irrationalarrow_forward
- Cocoa (Cacao) beans and imported from South America. The government has decided to increase the tax on imported goods such as cocoa. What effect would this have on the market for hot cocoa?arrow_forwardU.S. pharmaceutical companies charge different prices for prescription drugs to buyers in different nations, depending on elasticity of demand and government-imposed price ceilings. Explain why these companies, for profit reasons, oppose laws allowing re-importation of drugs to the United States.arrow_forwardThe domestic supply and demand curves for hula beans are as follows: P = 20 + Q (supply) and P = 250 - Q (demand) where P is the price in cents per pound and Q is the quantity in millions of pounds. Ireland is a small producer in this market where the current price is 50 cents per pound. The Irish Government is considering a tariff of 50 cents per pound. The reduction in consumer surplus after the tariff has been imposed is equal to A. 7500 B. 10,000 C. 8,750 D. 1500arrow_forward
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