Question

Suppose U.S. market demand for Chinese produced automobiles is = 120,000 where P is the price. Suppose the market supply of Chinese produced automobiles in the U.S. is = 3.

A). Find the competitive market equilibrium price and output of Chinese produced automobiles in the U.S.

B). Suppose the President of the U.S. puts a tariff of $2,000 on each Chinese produced automobile sold in the U.S. (a tariff is simply a tax on an imported good). Find the new market equilibrium price to U.S. buyers and output of Chinese produced automobiles in the U.S.

C).Show who bears the most burden of the tariff, the U.S. consumers of Chinese produced automobiles or the Chinese producers of the automobiles.

D). Using Social Benefit analysis, find the impact of the tariff (compared to the competitive equilibrium) on the welfare of the U.S. overall, and the welfare of the world overall. (I am looking for answers in dollars)