ECON 201 Lecture Notes - Lecture 9: Demand Curve, Marginal Utility, Deadweight Loss

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bronzesardine506

24 Feb 2015

School

University of Calgary

Department

Economics

Course

ECON 201

Professor

A L L

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Document Summary

Tarrif a tax on imported goods. Imports = q1d q1s at pw. Imports at pw + t: imports = q2d q2s. Therefore with tariff we have fewer imports. Inefficient surplus loss of surplus is a is lost (e and g), deadweight loss of the tariff. Tariff is disntance between pw and pw+t (tariff rev = tariff per unit * Infant- industry argument protect them while they get started but after a while stop because they won"t make it anyway. Chapter 10 externalities. Take red line from second graph and move it to first graph becomes parallel gap between is mec. Marginal social cost msc = mpc + mec. S = mpc (marginal private cost) Social optimum is efficient, qmarket is inefficient. D = mb (marginal benefit curve) Steel company should take cost ofpollution into account or made to do so. Would then operate at where social cost and demand curve intersect (b = social.

Related Questions

The diagram below shows the domestic demand and supply curves for denim jeans in Canada. The prevailing world price is PW. Assume that all jeans are identical. Pn - - - - Price - . - - Pw+t F - - - Quantity of denim jeans FIGURE 34-2 38) Refer to Figure 34-2. If Canada imposes a tariff of $t per pair of jeans, Canada's jean-producing firms will gain producer surplus equal to the area A) A. B) A+B+C. C) A+D. DD. E)D+E +F+G+H.

1. When markets fail, public policy can

a. do nothing to improve the situation

b. potentially remedy the problem and increase economic efficiency

c. always remedy the problem and increase economic efficiency

d. In theory, remedy the problem, but in practice, public policy has proven to be ineffective

2. An important factor in the decline of the US textile industry ever the past 100 or so years is

a. foreign competitors that can produce quality textile goods at low cost.

b. lower prices of goods that are substitutes for clothing

c. a decrease in Americans' demand for clothing, due to increased income and the fact that clothing is an inferior

d. the fact that the minimum wage in the US has failed to keep pace with the cost of living

3. Patterns of trade among nations are primarily determined by

a. cultural considerations.

b. political considerations

c. comparative advantage

d. differences in the income elasticity of demand among nations

4. A tax on an imported good is called a

a. quota

b. tariff

c. supply tax

d. trade tax

5. A quota is

a. a tax placed on imports.

b. a limit on the quantity of imports.

c. a tax on exports to other countries.

d. an excess of exports over imports.

6. A common argument in favor of restricting trade

a. concerns the strategy of bargaining.

b. is that efforts should be made to get new industries started.

c. emphasizes the belief that all countries should play by the same rules.

d. All of the above are correct.

7. Externalities are

a. side effects passed on to a party other than the buyers and sellers in the market.

b. side effects of government intervention in markets.

c. external forces that cause the price of a good to be higher than it otherwise would be.

d. external forces that help establish equilibrium price.

tariffa government tax on imports or exportsMore (Definitions, Synonyms, Translation)

maroonllama628

Price Quantity Supplied Quantity Demanded

(dollars per pound) (thousands of poundsper year) (thousands of pounds per year)

21 120 60

18 100 100

15 80 140

12 60 180

9 40 220

1) The United States imports cheese from a variety of countries.The table above gives the domestic supply
of, and demand for, cheese in the United States. The world price ofcheese is $12 per pound, and trade is
unrestricted.
a) How many pounds of cheese are consumed in the UnitedStates?
b) How many pounds of cheese are produced in the UnitedStates?
c) How many pounds of cheese are imported into the UnitedStates?
If a $3 per pound tariff is imposed,
d) How many pounds of cheese are consumed in the UnitedStates?
e ) How many pounds of cheese are produced in the UnitedStates?
f) How many pounds of cheese are imported into the UnitedStates?
g) How much will the U.S. government collect in tariffrevenue?
h) Who benefits from the tariff? Who loses

bluedeer558

ECON 201 Lecture Notes - Lecture 9: Demand Curve, Marginal Utility, Deadweight Loss

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