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Suppose the domestic demand and domestic supply are given by the following equations {this is the market under autarky, which means without international trade}, where
Suppose the domestic demand and domestic supply are given by the following equations {this is the market under autarky, which means without international trade}, where P stands for price and Q stands for quantity. Demand [D]: PD = 40 - 0.5Q Supply (5}: P5 = 10 + Q However, once this market opens to international trade, supply increases and the new supply curve. including the world supply is given by the following: Supply (5]. Piworld} = '20 + Q Given this information, what is the domestic quantityr demanded with world trade? A Question 7 (8 points) Retake question How much consumer surplus is in the market after the tariff? A/ How much producer surplus is in the market after the tariff? Round your answer to the nearest whole number. A/ What is the amount of dead-weight loss that results from the tariff? Round your answer to the nearest whole number. How much government revenue is generated as a result of the tariff? A/
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