2. The demand for vans in a certain country is given by: LO 16.3 MEDIUM where P is the price of a van. Supply by domestic van producers is: a)Assuming that the economy is closed, find the equilibrium price and production of vans. b)The economy opens to trade. The world price of vans is 18 units. Find the domestic quantities demanded and supplied, and the quantity of imports or exports. Who will favour the opening of the van market to trade, and who will oppose it? c)The government imposes a tariff of one unit per van. Find the

effects on domestic quantities demanded and supplied, and on the quantity of imports or exports. Also find the revenue raised by the tariff. Who will favour the imposition of the tariff, and who will oppose it? d)Can the government obtain the same results as you found in part (c) by imposing a quota on van imports? Explain.