1128 PM Fri Dec 3 a courseskpuca 5. (4 marks) The table provided shows the maximum amounts of cars and trucks produced in each of the countries with their given set of resources (in millions) i) What is the opportunity cost to produce one more truck in the US? Germany 25 Answer: 10 ii) has the comparative advantage in producing trucks iii) After specialization, Germany will produce (amount) of trucks iv) Before trade, each of the countries split their resources in half and produced their goods. If the countries specialized, then their gains in terms of trucks produced is 6. (4 marks) The demand and supply for American cars are represented by the following: P = 500 0.05Qd and P = 20 + 0.03Qs a) If the government imposes a quota of 2000 cars, what is the total surplus? TS: b) What per unit tax would the government have to set in order to have the total tax revenue equal to the total quota earnings if a quota of 2000 cars is imposed? Per Unit Tax: 0) If a price oor of $60 is imposed instead of the quota, what would be the new producer surplus? New Producer Surplus: '3' 44%