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3. Tariff: A US Congressman suggests Mexico is ruining US tomato production and proposes a protective tariff of S5 per cwt. a. b. Show on
3. Tariff: A US Congressman suggests Mexico is ruining US tomato production and proposes a protective tariff of S5 per cwt. a. b. Show on the figure from 2 how the tariff impacts the global price. Calculate the new equilibrium price and quantity. How much quantity is supplied by US producers? How much by Mexican producers? Are US tomato producers better or worse off under the new tariff policy (calculate or show graphically why)? Are US consumers better or worse off (calculate or show graphically why)
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