Assume that Australia is a "small" country and is unable to influence the world price. The demand and supply schedules for TV sets are shown below.

Price of TVs Quantity Demanded ('000) Quantity Supplied ('000)

5000 0 50

4000 10 40

3000 20 30

2000 30 20

1000 40 10

0 50 0

Use a diagram to illustrate and explain your answers to each of the following.

a) Determine the market equilibrium price and quantity for TV sets in Australia.[2 marks]

b) Calculate the value of Australian consumer surplus and producer surplus.[3 marks]

c) Under free trade conditions, suppose Australia imports TV sets at a price pf $1000 each. Determine the free trade equilibrium. How many TV sets will be produced, consumed, and imported?[3 marks]

d)Calculate the value of Australian consumer surplus and producer surplus from the situation in (c) above.[3 marks]

e) Assume that to protect its consumers from foreign competition the Australian government levies a specific tariff of $100 on imported TV sets. Determine the effects of the tariff on the price of TV sets in Australia, the quantity of TV sets supplied by Australian producers, the quantity of TV sets demanded by Australian consumers, and the volume of trade.[4 marks]

f) Calculate the reduction in Australian consumer surplus due to the tariff-induced increase in the price of TV sets.[3 marks]

g) Calculate the values of the tariff's consumption, protective, redistributive, and revenue effects.[4 marks]

h) What is the amount of deadweight loss imposed on the Australian economy by the tariff?[3 marks]