4. A graphical comparison of tariffs and quotas Aniva and Kartaly are small countries that protect their economic growth from rapidly advancing globalization by limiting the import of televisions to 20 millien. To this end, each country imposes a different type of trade barrier when the world price (F'w) is $2,000. In Aniva, the government decides to impose a tariff of $3,000 per television; in Kartaly, the government implements a guota of 20 million televisions. Assume that Aniva and Kartaly have identical domestic demand (Dg) and supply (S) curves for televisions as shown on the following graph. Under these conditions, the price of televisions is $5,000 per television in each country. @ 10000 a S 2000 8000 7000 6000 5000 4000 3000 PRICE (Dollars per television) 2000 1000 0 10 20 30 40 50 680 70O 80 %0 100 QUANTITY (Millions of televisions) Suppose that in both countries, demand for televisions rises from Dg to D1. Assuming Aniva keeps the tariff at $3,000 per television, complete the first row of the following table by calculating each of the values given this increase in demand. Assuming Kartaly maintains a quota of 20 million televisions, complete the second row of the table by calculating each of the values given this increase in demand. Price Quantity Demanded at New Price Imports Country (Dollars) (Millions of televisions) (Millions of televisions) Aniva (tariff = $3,000) [ ] [ ] [ ] Kartaly (quota = 20 million televisions) l:l l:l \\:I True or False: The increase in demand helps both domestic producers and consumers in Kartaly. O True O False Which of the following explain why a guotaisa restrictive trade barrier than an equivalent tariff. Check all that apply. Oa quota ensures the domestic industry a ceiling on imports. O By foreclosing the market mechanism, a quota suppresses competition. [J A foreign producer may offset the guota by the price reductions