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Econ. Recitation Notes 2

Econ. Recitation Notes 2 - National security ...

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S A A B Third Recitation 2.20 Notes: If the world price is below / above the equilibrium price of supply + demand curves, producers will import / export the difference in quantities A = price buyers going to face Imports = difference in Qs World Price D Q Q Reasons Not to Trade: Job loss: unions politically protesting (barriers to trade) Infant industry: Outperformed by multi-national corporations: not yet a strong / developed industry
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Unformatted text preview: ♫ National security ♫ TFP (Technical Factors of Production) coefficient (no units) → Tariffs: ♫ If the government imposes a tariff on suppliers, the supply curve shifts left S T S Government revenue = B → Net effect negative by A (distortion) → D...
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