Their impact on the industry on which they are

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Unformatted text preview: quotas: Considers only their impact on the industry on which they are imposed , rather than their economy-wide effects Consumer and Producer Surplus !'fi®& wmrm mttmrm•rnwm %~ There are two key concepts in the analysis of the impact of tariffs - Consumer surplus: value received by consumers in excess of the price they pay (can be measured only if the demand curve is known) cs - Producer surplus: value received by producers in excess of the minimum price at which they are willing to produce (can be measured only if the supply curve is known) FIGURE 6.1 Consumer and Producer Surplus PS u'r:MI t So p{>I_'.'\ • bi lIJIN eq v1!. I It . (3 .1 - t I"')~ • l...
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This document was uploaded on 03/27/2014 for the course ECON E430 at Indiana University South Bend.

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