What government revenues are generated by the policy

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Reference no: EM13245763

Suppose that the world price for steel is below the U.S. domestic price, but the government requires that all steel used in the United States be domestically produced.

a.Use a diagram like the one below to show the gains and losses from such a policy.
b.How could you estimate the net welfare loss (deadweight loss) from such a diagram?
c.What response to such a policy would you expect from industries (like automobile producers) that use U.S. steel?
d.What government revenues are generated by this policy?

Reference no: EM13245763

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