Reference no: EM132397247
ECON 3730 - Forestry Economics Assignment - Thompson Rivers University, Canada
The domestic demand and supply for two Countries, A and B, and the International Market are given below. Illustrate the free trade equilibrium. With trade, what is the equilibrium price that clears the international market?
Does Country A import or export good X and how many units are imported or exported by country A?
Does Country B import or export good X and how many units are imported or exported by country B?
Now suppose that the importing country would like reduce imports to ½ of their current quantity. What size tariff will reduce the total imports by ½?
Given the tariff, what is the new price of good x in Country A and what is the new price of good x in Country B?
Indicate the area(s) that represent the net Impact of the tariff each country. Indicate your answers in column 2 of the tables below. (Indicate areas and whether they are a gain or a loss).
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Net effect of tariff on Surplus
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2. Redo question 1 for an Export Tax
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Net effect of an export tax
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Country A Consumers
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Country A Consumers
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Country A Producers
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Country A Producers
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Country A Government Revenue
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Country A Government Revenue
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Country A as a whole
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Country A as a whole
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Country B Consumers
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Country B Consumers
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Country B Producers
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Country B Producers
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Country B Government Revenue
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Country B Government Revenue
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Country B Country as a whole
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Country B Country as a whole
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Global surplus
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Global surplus
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Attachment:- Forestry Economics Assignment File.rar