Refer to the given scenario and as Cambodia moves from no trade to free trade, Select one: 0 a. The value added changed by $15 0 b. Consumers enjoy free trade as they get to consume more 0 c. The domestic rms suffer from a lower price and a lower quantity sold 0 d. All the given options Refer to the case study of Cambodia bicycle production - Which of the following explains the effects of proposal 1 ? Select one: 0 a. The ERP of proposal 1 is 200% O b. The trade policy increase the level of value added by $10 0 c. All the given options 0 d. Reduces the level of imports by 60 units Comparing proposal 2 to 3 , we can conclude Select one: 0 a. ERP for proposal 3 is lower by 320% O b. ERP for proposal 3 is lowest at 0% O c. ERP for proposal 2 is the same as proposal 3 0 d. None of the given options Refer to to the given case study, the adoption of proposal 3 in Cambodia will lead to Select one: C) a. zero level of import as the tariffs will cancel out each other O b. zero level of imports O c. Same level of import as given in the quota 0 d. No domestic supply as the rms face taxes on both input and output Working Table Proposal! Case of Price of ' Effective bicycles Rate of Domestic production {Hint : equate domestic demand to Proposal 1 Quota of 3D units Proposal 2 {Tariff at BEBE. on imported bicycles} Proposal 3 TariC of 20% on imported bicycles and sees on bicycle components Refer to the case study of Cambodia bicycle production Which of the following statement explains the changes in import level when the proposals is adopted? Select one: O a. If they adopt Policy 1, imports will fall BY 60 units O b. If both Policy 2 and 3, imports will fall BY 90 units O c. Implementing Policy 2 will lead to the highest level of ERP O d. All the given optionsThe case study will be used for Q1 - 5; You can work on the computations and complete the table to answer Q 1 to 5. CAMBODIA AND PROTECTIONISM IN BICYCLE INDUSTRY The Cambodia government is considering to further develop the bicycle manufacturing industry to support its growing domestic market with the given functions Domestic Supply: Q = 4P Domestic Demand: Q = 600 - 2P where P and Q refers to the quantity and price of bicycles respectively In addition, the cost of bicycle components is $80 per set and all fully imported from China. At free trade position Cambodia imports bicycles from China, at a competitive world price of $85 per set. Her domestic firms continue to import bicycle components for the domestic production at $80 per set. [Hint: Derive the import function using Domestic demand less domestic supply ] Proposal of trade protection Proposal 1 : A quota of 30 sets of bicycles from China and no tax on imported bicycle components Proposal 2 : A 20% tariff on imported bicycles to boost local production with no tax on imported bicycle components Proposal 3: A 20% tariff on imported bicycles and a 20 % tariff on imported components for bicycles