Question

130 140 ons bushels Figure 61 7) 7) Based on Figure 6.1, suppose the government puts a tariff of 50 25 per bushel on soybean imports. How much will the tariff reduce imports A) Imports will decrease by 20 million bushels B) Imports will decrease by 60 million bushels. C) Imports will not change after the tariff D) Imports will decrease by 10 million bushels 3) Based on Figure 6.1. given a tariff of 50 25 per bushel on soybean imports, how much will domestic production increase? A) Domestic firms production will not be changed by the tarift. B) Domestic firms will increase output by 10 million bushels. C) Domestic firms will increase output by 70 million bushels D) Domestic firms will increase output by 20 million bushels 9 9) Based on Figure 6.1, how much revenue will the government raise from a $0.25 per bushel tariff on soybean imports? A) The government will raise $2.5 million B) The government will raise $15 million C) The government will raise $325 million D) The government will raise $5 million E) The government will e no increase in income because the country is small for firme will simply not serve it after the tariff is imposed

Answer 1

Ans7) the correct option is a) imports will decrease by 20 million bushels

Initial imports = 140 - 60 = 80

New imports = 130 - 70 = 60

Ans8) the correct option is b) Domestic firms will increase output by 10 million bushels

Ans9) the correct option is b) the government will raise $ 15 million

Revenue = 0.25*60 = 15