Question
a)Using a demand/supply diagram , illustrate and explain the effects of the imposition of an export tax on a good Y by a home country's
a)Using ademand/supply diagram, illustrate and explain the effects of the imposition of an export tax on a goodYby a home country's government on
(i)the Nigerian consumers ofY,
(ii)the Nigerian producers ofY, and
(iii) the Nigerian government's tax revenues.
Assume that Nigeria is a "small" country. Evaluate the "net welfare effect" of the tax.Why might a country want to impose an export tax?Explain.
(b)Suppose now that Nigeria is imposing export tax in part (a) of this question is a "large" country rather than a "small" country.Is it an advantage or a disadvantage for a country to be "large" rather than "small" when it imposes an export tax?Explain.
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