Question 2: TARIFFS and TRADE... *#595959509595959: 20 points

PANEL A PANEL B PRICE PRICE Supply from Demand fro m QUANTITY Supply from FOREIGN FOREIGN Dema nd from HOME QUANTITY Use Panel A and Panel B in the following: Note that the only difference is the slope Of the Excess Supply curve. (6 points) (c) Consider the impact of Home imposing a IOS tariff on imported goods from Foreign. Does Home gain more in Panel A or in Panel B from the IOS tariff? Explain fully and relate to the Terms of Trade effects as well as the distortionary effects. Be sure to give the intuition.