3. (10 points) Suppose that the demand and supply of jeans in Italy are described by the following equations: D:P = 150-

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3. (10 points) Suppose that the demand and supply of jeans in Italy are described by the following equations: D:P = 150-

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3 10 Points Suppose That The Demand And Supply Of Jeans In Italy Are Described By The Following Equations D P 150 1
3 10 Points Suppose That The Demand And Supply Of Jeans In Italy Are Described By The Following Equations D P 150 1 (60.27 KiB) Viewed 38 times
3. (10 points) Suppose that the demand and supply of jeans in Italy are described by the following equations: D:P = 150-4Q S:P= 6 + 20 (a) Draw a graph for this. What are the autarky price and quantity in Italy? (b) Suppose a UK producer is willing to sell the same jeans at a price of 30 EUR. Under free trade, how many pairs of jeans will be produced domestically? How many pairs of jeans will Italians buy? Will Italy import or export jeans? (c) Suppose that after protests from Italian jeans producers, the government decides to impose a tariff of 20% on imported jeans. Will Italian consumption and production of jeans change? By how much? How much revenue does the government earn from the tariff?
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