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Rank the welfare of the entire country with the following protection policies under perfect competition and explain your reasoning. (a) Tariff t1 per unit of
Rank the welfare of the entire country with the following protection
policies under perfect competition and explain your reasoning.
(a) Tariff t1 per unit of imports to a large country, and the equilibrium imported
quantity is M1 > 0. Assume that the tariff t1 is higher than the optimal tariff.
(b) Tariff t2 per unit of imports to a large country, and the equilibrium imported
quantity is M2 > M1 and M2 > 0.
(c) Tariff t3 per unit of imports to a large country, and the equilibrium imported
quantity is 0.
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