The domestic demand and domestic supply of shirts in a small economy are where and are quantity supplied and quantity demanded respectively, and denotes the market price. The price of a shirt in the international market is given to be 2 units.
In Question No. , if the home country imposes an import tariff of 1 unit, then the government tariff revenue will be
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The domestic demand and domestic supply of shirts in a small economy are Qₛ = 15P - 15 Q_d = 85 - 10P where Qₛ and Q_d are quantity supplied and quantity demanded respectively, and P denotes the market price. The price of a shirt in the international market is given to be 2 units. In Question No. 15, if the home country imposes an import tariff of 1 unit, then the government tariff revenue will be (A) 65 (B) 55 (C) 35 (D) 25
Also written as: The domestic demand and domestic supply of shirts in a small economy are Q_s = 15P - 15 Q_d = 85 - 10P where Q_s and Q_d are quantity supplied and quantity demanded respectively, and P denotes the market price. The price of a shirt in the international market is given to be 2 units. In Question No. 15, if the home country imposes an import tariff of 1 unit, then the government tariff revenue will be
Trade policy: tariffs, quotas and protection has come up 63 times in 6 exams since 2010.
This question is on Tariffs: welfare effects, optimum tariff and incidence, part of Trade policy: tariffs, quotas and protection in International Economics.
What a tariff does to prices, output, revenue and welfare in small and large countries.
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Question from the JNU SIS 2017 paper. Solutions are TestStop's own. Not affiliated with or endorsed by any examination authority.