Homework (Ch 09)Q Search thThe following graph shows the domestic supply of and demand for maize in Panama. The world price (Pw) of maize is $270 per ton and is representedby the horizontal black line. Throughout the question, assume that the amount dermanded by any one country does not affect the world price of maizeand that there are no transportation or transaction costs associated with international trade in maize. Also, assume that domestic suppliers will satisfydomestic demand as much as possible before any exporting or importing takes place.Domestic DemandDomestic Supply450430410300370350330260270PRICE (Dollars per ton) 390370Tools350u 330310+29027025040160 200240 280 320QUANTITY (Tons of maize)120360 400EE 7-mitedבIf Panama is open to international trade in maize without any restrictions, it will importtons of maize.Suppose the Panamanian government wants to reduce imports to exactly 160 tons of maize to help domestic producers. A tariff of Sper tonWill achieve this.A tariff set at this leveliwould raisein revenue for the Panamanjan governmentePRICE (Dollars per tan)

390 370 350 330 310 20 270 250 120 160 200 QUANTITY (Tons of maize) 40 SO 240 280 320 360 400 If Panama is open to international trade in maize without any restrictions, it will import tons.of maize. Suppose the Panamanian government wants to reduce imports to exactiy 150 tons of maize to help domestic producers. A tariff of s per ton will achieve this. A tariff set at this level would raise in revenue for the Panamania government PRICE (Dollars pertan)

390 370 350 330 310 20 270 250 120 160 200 QUANTITY (Tons of maize) 40 SO 240 280 320 360 400 If Panama is open to international trade in maize without any restrictions, it will import tons.of maize. Suppose the Panamanian government wants to reduce imports to exactiy 150 tons of maize to help domestic producers. A tariff of s per ton will achieve this. A tariff set at this level would raise in revenue for the Panamania government PRICE (Dollars pertan)

Microeconomic Theory

12th Edition

ISBN:9781337517942

Author:NICHOLSON

Publisher:NICHOLSON

Chapter12: The Partial Equilibrium Competitive Model

Section: Chapter Questions

Problem 12.8P

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