Suppose the domestic shoe demand and supply equations in a small open economy are: P = 168-4Q D P = 24+2Q S On the other hand, the shoe demand and supply equations of the large open economy are: Let's...


Suppose the domestic shoe demand and supply equations in a small open economy are:


P = 168-4QD


P = 24+2QS



On the other hand, the shoe demand and supply equations of the large open economy are: Let's assume:


P = 360- 6QD


P = 40 + 2QS





A) Suppose the large country imposes a customs tax of $ 12 per unit of good on top of the free trade price, and the smaller country drops it below $ 4.



For the Large country of customs tax application in the light of above information


What would happen to these:



1- In the welfare of the consumer.



2- In the welfare of the manufacturer.




Jun 08, 2022
SOLUTION.PDF

Get Answer To This Question

Related Questions & Answers

More Questions »

Submit New Assignment

Copy and Paste Your Assignment Here