Please answer as detailed as possible Assume that demand for strawberries in Norway is given by p=100-Q
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Please answer as detailed as possible
Assume that demand for strawberries in Norway is given by p=100-Q and domestic supply of apples by p= 10+Q, where p is price in kronor and Q kilos of strawberries. Assume that the world market price of strawberries is 20 kronor per kilo.
a) What is the price of strawberries in Norway if there is free trade and how many strawberries are imported?
b) Assume that Norway imposes a tariff of 20 kronor per kilo of strawberries. What is the effect on consumer surplus and on domestic producer surplus? How high are tariff revenues? What is the deadweight loss of the tariff?
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