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Suppose Mexico is importing steel from Russia. Now Mexico imposes a binding import quota on the...

Suppose Mexico is importing steel from Russia. Now Mexico imposes a binding import quota on the import of steel from Russia. Draw and label a graph showing the effect of the import quota on Mexican domestic price of steel, the change to domestic Mexican consumer surplus and the change to domestic Mexican producer surplus. Indicate in your graph the quota rents. If Mexico allows Russia to administer the import quota program, what is the total economic welfare loss to Mexico?

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