Calculate the value of tariff revenue – Microeconomics
Quiz Three-
1. A small open financial system opens its banana market to commerce. If the value of bananas in the world market is $2 per unit whereas the value of bananas on this small financial system when it’s closed is the same as $1, we will conclude that
a. Commerce will profit the home shoppers on this small financial system.
b. Commerce will profit the home producers on this small financial system.
c. Complete surplus in the small financial system will enhance with commerce.
d. Solutions (a) and (c) are each true.
e. Solutions (b) and (c) are each true.
f. Solutions (a), (b) and (c) are all true.
2. Given the info in Question Assignment (1), this small financial system will ___________ bananas as soon as the banana market is open to commerce.
a. import
b. export
Use the following info to reply the subsequent three questions.
The home demand and home provide curve for books in a small closed financial system are given by the following equations:
Home Demand: P = 200-2Q
Home Provide: P = 2Q
The world value of books is $20. Suppose this financial system opens its ebook market to commerce and concurrently enacts a tariff of $20 per ebook.
Three. Calculate the value of tariff revenue given the above info.
four. Calculate the value of client surplus when the ebook market is closed and the value of client surplus as soon as the tariff is applied. Do home shoppers choose the closed financial system or the open financial system with the tariff on this scenario?
5. Calculate the deadweight loss from the tariff.
6. Suppose Joe’s earnings is $500 and he spends it on both film tickets (M) or dinners out (D). If Joe spends all of his earnings on film tickets he can afford 40 tickets and if he spends all of his earnings on dinners out he can afford 20 dinners.
a. What’s the value of a film ticket?
b. What’s the value of a dinner?
c. Which of the following mixtures of motion pictures and dinners (M, D) are on Joe’s price range line? Circle the mixtures which can be on Joe’s price range line.
i. 10 M, 30 D
ii. 20 M, 15 D
iii. 10 M, 15 D
iv. eight M, 16 D
d. Suppose that Joe maximizes his utility given the above info when he consumes 20 dinners. If the value of dinners modifications to $40 Joe will maximize his utility by consuming 5 dinners. Write an equation for Joe’s demand curve for dinners given this info. Assume this demand curve is a linear demand curve.
