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3. Consider a small open economy that imposes a tariff on imports for Jetskis. a) Use a graph of import demand and export supply to
3. Consider a small open economy that imposes a tariff on imports for Jetskis. a) Use a graph of import demand and export supply to show: the gains from trade (vs. autarky), the tariff revenue, and the deadweight loss. b) Now suppose that the country experiences a hurricane and half of the Jetski producing factories are wiped out. Show what happens to the gains from trade, the tariff revenue, and the deadweight loss (relative to before the hurricane)
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