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Page 1 ECON 1014 HOMEWORK #4Name: _____________________ Student #:_____________ Pawprint: ____________ Due: Monday, March 12th by 4:00pm at the Econ Help Desk, Room 1A-West in the basement of the Professional Building. No late assignments will be accepted. We suggest you photocopy or photograph your homework with answers; otherwise, no excuses will be given for lost homework. Photographed or scanned HW assignments MUST have a valid, pre-deadline timestamp to be accepted. Please print this assignment from Canvas and staple!! Chapter 9 Use the following to answer question 1: Figure: Trade a. If this figure represents the market for oil and the country imposes no tariffs on international trade, domestic consumption will be: (1 pt.)
Page 2 b. Calculate the tariff revenuegenerated, the value of lost gains from tradeand value of wasted resourcescaused by imposing a $25 tariff in this market. (3 pts.) c. With a tariff in this market, by how much does the domestic producer surplus and consumer surplus change? (2 pts.) 2. If quotas on sugar were eliminated in the United States, domestic production of sugar would fall. Why is this a benefit in economic terms for the United States? (1 pt. CHOOSE 1) I. Resources are freed up that could be used more efficiently elsewhere. II. It allows foreign producers of sugar to earn income, some of which may be spent on imports from the U.S. III. U.S. consumers are able to enjoy increased consumer surplus because of the lower prices of imported sugar.