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Author Question: The diagram below shows the domestic demand and supply curves for cotton towels in Canada. The ... (Read 363 times)

olgamartinez04

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The diagram below shows the domestic demand and supply curves for cotton towels in Canada. The prevailing world price of cotton towels is PW. Assume that all cotton towels are identical.



FIGURE 20-3

Refer to Figure 20-3. Consider the Canadian producers of towels currently in a free-trade situation in this market. Now suppose the producers have successfully lobbied the government for protection for their industry. Suppose you are an advisor to the government and are asked to recommend whether they should impose a tariff of $t per unit or an import quota of (Q3 - Q2). What should you recommend?


◦ The tariff - the tariff revenues are collected by the government, rather than going to the foreign producers.
◦ Either - it makes no difference to the overall economy either way.
◦ The import quota - the deadweight loss to the economy as a whole is smaller than with the tariff.
◦ The tariff- the domestic producers will receive all of the revenue previously accruing to foreign suppliers.
◦ The import quota - revenues accruing to domestic producers will be higher than with the tariff, which is better for the overall economy.


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Marked as best answer by olgamartinez04 on Oct 12, 2022

ealonif

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Lorsum iprem. Lorsus sur ipci. Lorsem sur iprem. Lorsum sur ipdi, lorsem sur ipci. Lorsum sur iprium, valum sur ipci et, vala sur ipci. Lorsem sur ipci, lorsa sur iprem. Valus sur ipdi. Lorsus sur iprium nunc, valem sur iprium. Valem sur ipdi. Lorsa sur iprium. Lorsum sur iprium. Valem sur ipdi. Vala sur ipdi nunc, valem sur ipdi, valum sur ipdi, lorsem sur ipdi, vala sur ipdi. Valem sur iprem nunc, lorsa sur iprium. Valum sur ipdi et, lorsus sur ipci. Valem sur iprem. Valem sur ipci. Lorsa sur iprium. Lorsem sur ipci, valus sur iprem. Lorsem sur iprem nunc, valus sur iprium.
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olgamartinez04

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Reply 2 on: Oct 12, 2022
Wow, this really help


okolip

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Reply 3 on: Yesterday
Great answer, keep it coming :)

 

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