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Suppose that in both countries, demand for rugs rises from Do to D- Assuming Aniva keeps the tariff at $3,000 per rug, complete the
Suppose that in both countries, demand for rugs rises from Do to D- Assuming Aniva keeps the tariff at $3,000 per rug, complete the first row of the following table by calculating each of the values given this increase in demand. Assuming Kartaly maintains a quota of 20 million rugs, complete the second row of the table by calculating each of the values given this increase in demand. Country Aniva (tariff $3,000) Kartaly (quota = 20 million rugs) Price (Dollars) Quantity Demanded at New Price (Millions of rugs) Imports (Millions of rugs) True or False: The increase in demand helps domestic producers but hurts domestic consumers in Kartaly. O True O False Which of the following explain why a quota is a restrictive trade barrier than an equivalent tariff. Check all that apply. OA quota ensures the domestic industry a ceiling on imports. By foreclosing the market mechanism, a quota suppresses competition. A foreign producer may offset the quota by the price reductions. a Save & Continue
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