Question

The demand for sunglasses is given by D(p) = 100 − 2 p and the supply curve is given by S(p) =3p

(a) Compute the equilibrium price and equilibrium quantity of sunglasses.

(b) Sketch both the demand and supply curves on the same graph (be sure to label your axes correctly).

(c) Determine the value of consumer surplus and producer surplus at the equilibrium values. Suppose all sunglasses are imported from China. Suppose also that the government imposes an import tariff of $10 per unit. Show working

(d) Determine the new equilibrium values of price and quality. show working

(e) Determine the tariff’s impact on consumer surplus, producer surplus, and total surplus.

Answer #1

D. The new equlibrium price is 30 and equilibrium quantity is 40

E. After tariff the consumer surplus reduces, the producer surplus reduces and total surplus also reduces.

Given the previous questions with a world price of 34, and the
domestic demand and supply curves given by the following
equations:
D: P= 80 - 2Q S: P= 10 + 3Q
Suppose the government imposes a tariff equal to 6 which
increases the price in the domestic market to 40. Given the tariff
and new price to consumers, domestic consumers will now import
______ units of the good, the government will collect ______ in
tariff revenue, and the total...

4. Suppose the domestic supply and demand curves for petroleum
in the U.S. are, Qs = 10P - 300 Qd = 3000 - 20P Let the world trade
price be $50 per barrel. 1) What is the equilibrium quantity of
imports? 2) Suppose a specific tariff of $10 per barrel is imposed.
Calculate Consumer surplus, producer surplus, and tariff revenue.
3) Suppose the government imposes an import quota of 1200 units of
barrels. Find the trading price for petroleum.

Suppose the world price for a good
is 40 and the domestic demand-and-supply curves are given by the
following equations:
Demand: P = 80 – 2Q
Supply: P = 5 + 3Q
a. How much is
consumed?
b. How much is produced
at home?
c. What are the values
of consumer and producer surplus?
d. If a tariff of 10
percent is imposed, by how much do consumption and
domestic production change?
e. What is the change in
consumer and...

The market for apples is perfectly competitive, with the market
supply curve is given by P = 1/8Q and the market demand curve is
given by P = 40 – 1/2Q.
a. Find the equilibrium price and quantity, and calculate the
resulting consumer surplus and producer surplus. Indicate the
consumer surplus and producer surplus on the demand and supply
diagram.
b. Suppose the government imposes a 10 dollars of sale tax on
the consumer. What will the new market price...

Suppose the demand curve is given by Qd=75-5P and the supply
curve is given by Qs=P-3. SHOW YOUR WORK in the space below (type
it out, line by line), and solve for the equilibrium price, the
equilibrium quantity, the consumer surplus, the producer surplus,
and the total surplus.

The domestic demand for radio is given by Q= 5000 - 100 P. The
domestic supply curve for radio is given by Q= 150P. Suppose radios
can be imported at a world price of $10 per radio.
1) Now suppose domestic radio producers succeed in getting a $5
tariff implemented, how many radios would be imported?
2) How much would be collected in tariff revenue?
3) How much consumer surplus would be transferred to domestic
producers?
4) What would the...

The domestic demand for radio is given by Q= 5000 - 100 P. The
domestic supply curve for radio is given by Q= 150P. Suppose radios
can be imported at a world price of $10 per radio.
1) Now suppose domestic radio producers succeed in getting a $5
tariff implemented, how many radios would be imported?
2) How much would be collected in tariff revenue?
3) How much consumer surplus would be transferred to domestic
producers?
4) What would the...

The domestic demand for radio is given by Q= 5000 - 100 P. The
domestic supply curve for radio is given by Q= 150P. Suppose radios
can be imported at a world price of $10 per radio.
1) Now suppose domestic radio producers succeed in getting a $5
tariff implemented, how many radios would be imported?
2) How much would be collected in tariff revenue?
3) How much consumer surplus would be transferred to domestic
producers?
4) What would the...

2. Suppose that Economica is a large country. The export supply
curve is as follows
Price Quantity
60 60
80 120
100 180
120 240
Assume that Economica imposes a $20 tariff on imported oil.
Assume that the world price of oil is initially $80.
a. Graph the import demand and export supply curves
Calculate
b. the price of oil in Economica
c. the price of oil in the Rest of the World
d. The change in producer surplus

Suppose that the demand and supply functions for good X
are:
Qd = 298 - 8P and
Qs = - 32 + 4p
A. Find the equilibrium price and quantity.
B. Sketch this market. [HINT: Be sure to draw the two curves
carefully, using inverse demand and supply functions to calculate
the quantity- and price-axes intercept points.]
C. Use the demand function to calculate consumer surplus.
D. Use the supply function to calculate producer surplus.
E. What is the total...

ADVERTISEMENT

Get Answers For Free

Most questions answered within 1 hours.

ADVERTISEMENT

asked 1 minute ago

asked 2 minutes ago

asked 2 minutes ago

asked 2 minutes ago

asked 2 minutes ago

asked 2 minutes ago

asked 2 minutes ago

asked 3 minutes ago

asked 5 minutes ago

asked 5 minutes ago

asked 8 minutes ago

asked 9 minutes ago