Question 2. A large country (LC) is tarpe consumer of steel and is able to influence the world price of steel is deadly for steel are shown in Figure 2. below, as Du and Sil. trapectively. The (C+ world) supply is denoted by Pout 2 imported by sarpe Country Suc 8.00 Sem 500 Die 3 so with free trade .) What is the price of steel is the larger country? (b) How many millions of tons of strede produce each year! (c) How many millions of sons of steel to buyers purchase each year. (a) How many millions of tons of steel are imported each year? Suppose the large country imposes a 575 per to tariffon steel imports. (c) What is the price of steel in the large country? How many millions of our tons of steel are imported each year? ) of the 575/ton tarif how much is prieden te are country.consumers via a higher price th) of the 575 tarif, bow muchas borne by the forexperter? (Your answers to (R) and (h) should sum to 375) ) What is the tariffs deatheight loss to the large country? 0) What is the overall change in welfare of the large country due to the tariff (enter as a negative number if welfare decreases) Question 2. A large country (LC) is a large consumer of steel and is able to influence the world price of steel. Its demand and supply for steel are shown in Figure 2. below, as Dic and So respectively. The overall (LC + world) supply is denoted by Suc-w. Figure 2: Import Tariff Impossed by a "Large" Country 1000 950 900 Sic 800 750 700 650 SLC-Wet 600 Sicow Price 550 500 450 400 Die 350 300 250 200 150 100 50 0 10 20 30 40 50 60 70 80 90 100 Millions of tons of steel per year With free trade: (a) What is the price of steel in the large country? (b) How many millions of tons of steel do LC firms produce each year? (c) How many millions of tons of steel do LC buyers purchase each year? (d) How many millions of tons of steel are imported each year? Suppose the large country imposes a $75 per ton tariff on steel imports. (e) What is the price of steel in the large country? (1) How many millions of tons of steel are imported each year? (g) of the $75/ton tariff, how much is passed on to the large country.consumers via a higher price? (h) of the $75 tariff, how much is borne by the foreign exporter? (Your answers to (g) and (h) should sum to $75.) (i) What is the tariff's deadweight loss to the large country? 6) What is the overall change in welfare of the large country due to the tariff? (enter as a negative number if welfare decreases) Question 2. A large country (LC) is tarpe consumer of steel and is able to influence the world price of steel is deadly for steel are shown in Figure 2. below, as Du and Sil. trapectively. The (C+ world) supply is denoted by Pout 2 imported by sarpe Country Suc 8.00 Sem 500 Die 3 so with free trade .) What is the price of steel is the larger country? (b) How many millions of tons of strede produce each year! (c) How many millions of sons of steel to buyers purchase each year. (a) How many millions of tons of steel are imported each year? Suppose the large country imposes a 575 per to tariffon steel imports. (c) What is the price of steel in the large country? How many millions of our tons of steel are imported each year? ) of the 575/ton tarif how much is prieden te are country.consumers via a higher price th) of the 575 tarif, bow muchas borne by the forexperter? (Your answers to (R) and (h) should sum to 375) ) What is the tariffs deatheight loss to the large country? 0) What is the overall change in welfare of the large country due to the tariff (enter as a negative number if welfare decreases) Question 2. A large country (LC) is a large consumer of steel and is able to influence the world price of steel. Its demand and supply for steel are shown in Figure 2. below, as Dic and So respectively. The overall (LC + world) supply is denoted by Suc-w. Figure 2: Import Tariff Impossed by a "Large" Country 1000 950 900 Sic 800 750 700 650 SLC-Wet 600 Sicow Price 550 500 450 400 Die 350 300 250 200 150 100 50 0 10 20 30 40 50 60 70 80 90 100 Millions of tons of steel per year With free trade: (a) What is the price of steel in the large country? (b) How many millions of tons of steel do LC firms produce each year? (c) How many millions of tons of steel do LC buyers purchase each year? (d) How many millions of tons of steel are imported each year? Suppose the large country imposes a $75 per ton tariff on steel imports. (e) What is the price of steel in the large country? (1) How many millions of tons of steel are imported each year? (g) of the $75/ton tariff, how much is passed on to the large country.consumers via a higher price? (h) of the $75 tariff, how much is borne by the foreign exporter? (Your answers to (g) and (h) should sum to $75.) (i) What is the tariff's deadweight loss to the large country? 6) What is the overall change in welfare of the large country due to the tariff? (enter as a negative number if welfare decreases)
