6. Effects of a tariff in a small nation Suppose Zambia is open to free trade in the world market for oranges. Because of Zambia's small size, the demand for and supply of oranges in Zambia do not affect the world price. The following graph shows the domestic oranges market in Zambia. The world price of oranges is Pw = $800 per ton. Throughout this problem, assume that changes in trade policies in other nations do not significantly affect the world market for oranges and that there are no transportation or transaction costs associated with international trade in oranges. Also assume that domestic supplies will satisfy domestic demand as much as possible before any exporting or importing takes place. On the following graph, use the green triangle (triangle symbols) to shade the area representing consumer surplus (CS) when the economy is at the free-trade equilibrium. Then, use the purple triangle (diamond symbols) to shade the area representing domestic producer surplus (PS). (? ) 1280 Domestic Demand Domestic Supply 1220 CS 1160 1100 1040 PS 980 PRICE (Dollars per ton) 920 860 PW 800 740 680 6 9 2 15 18 21 24 27 30 QUANTITY (Thousands of tons of oranges) If Zambia allows international trade in the market for oranges, it will import tons of oranges. (Note: Be sure to enter the full value for your answer, accounting for the horizontal axis units.) Now suppose the Zambian government decides to impose a tariff of $120 on each imported ton of oranges. After the tariff, the domestic price of a ton of oranges will be | $ , and Zambia will import tons of oranges. Show the effects of the $120 tariff on the following graph. Use the grey line (star symbol) to indicate the world price plus the tariff. Then, use the green triangle (triangle symbols) to show the consumer surplus with the tariff and the purple triangle (diamond symbols) to show the domestic producer surplus with the tariff. Lastly, use the orange quadrilateral (square symbols) to shade the area representing government revenue received from the tariff and the tan triangles (dash symbols) to shade the areas representing the net loss or deadweight loss (DWL) caused by the tariff.If Zambia allows international trade in the market for oranges, it will import tons of oranges. (Note: Be sure to enter the full value for your answer, accounting for the horizontal axis units.) Now suppose the Zambian government decides to impose a tariff of $120 on each imported ton of oranges. After the tariff, the domestic price of a ton of oranges will be | $ , and Zambia will import tons of oranges. Show the effects of the $120 tariff on the following graph. Use the grey line (star symbol) to indicate the world price plus the tariff. Then, use the green triangle (triangle symbols) to show the consumer surplus with the tariff and the purple triangle (diamond symbols) to show the domestic producer surplus with the tariff. Lastly, use the orange quadrilateral (square symbols) to shade the area representing government revenue received from the tariff and the tan triangles (dash symbols) to shade the areas representing the net loss or deadweight loss (DWL) caused by the tariff. ? 1280 Domestic Demand Domestic Supply 1220 1160 World Price Plus Tariff 1100 : 1040 CS PRICE (Dollars per ton) 980 920 PS 860 PW 800 Government Revenue 740 3 6 9 12 15 18 21 24 27 30 DWL QUANTITY (Thousands of tons of oranges) Complete the following table to summarize your results from the previous two graphs. Under Free Trade Under a Tariff (Dollars) (Dollars) Consumer surplus Producer surplus Government revenue Based on your analysis, as a result of the tariff, Zambia's consumer surplus by $ ,and producer surplus by $ Taking into account how much revenue the tariff generates for the government, the net welfare effect is a of $1280 Domestic Demand Domestic Supply 1220 CS 1160 1100 1040 PS 980 PRICE (Dollars per ton) 920 860 PW 800 740 680 3 6 9 12 15 18 21 24 27 30 QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 CS 1160 1100 PS 1040 980 PRICE (Dollars per ton) 920 860 PW 800 740 680 0 3 6 9 12 15 18 21 27 30 QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 World Price Plus Tariff 1160 1100 CS 1040 980 PRICE (Dollars per ton) 920 Pw+t PS 860 PW 800 Government Revenue 740 680 3 6 9 ( 12 15 18 21 24 27 30 DWL QUANTITY (Thousands of tons of oranges)1280 /\\ Domestic Demand Domestic Supply 1220 World Price Plus Tariff 1160 1100 CS 1040 980 PRICE (Dollars per ton) 920 PS 860 PW 800 Government Revenue 740 680 0 3 6 9 12 15 18 21 24 27 30 DWL QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 CS 1160 1100 PS 1040 480 980 PRICE (Dollars per ton) 920 860 PW BOO 24 740 680 0 3 6 9 12 15 18 21 24 27 30 QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 CS 1160 1100 PS 1040 980 PRICE (Dollars per ton) 320 860 PW 800 120 740 680 0 3 6 9 12 15 18 21 24 27 30 QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 1160 World Price Plus Tariff 1100 360 1040 CS 980 PRICE (Dollars per ton) 18 920 PS 860 PW 800 Government Revenue 740 680 3 6 9 12 15 18 21 24 27 30 DWL QUANTITY (Thousands of tons of oranges)1280 Domestic Demand Domestic Supply 1220 World Price Plus Tariff 1160 1100 1040 CS 980 PRICE (Dollars per ton) 920 PS 12 860 240 PW 800 Government Revenue 740 680 3 6 9 12 15 18 21 24 27 30 DWL QUANTITY (Thousands of tons of oranges)