- Can I Get Some Detailed Explanation For This Question 1 (93.91 KiB) Viewed 62 times
Can i get some detailed explanation for this question?
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Can i get some detailed explanation for this question?
Can i get some detailed explanation for this question?
There are three countries in the world: Country A, Country B, and Country C. These countries have the following domestic demand and supply functions for product X; SA=PA, DA= 150-PA SB=2PB, DB = 150 Pa; Sc=4Pc, Dc = 150-Pc where subscripts denote countries of the corresponding variables. Now consider a customs union between Country A and Country B under which these countries impose a common external tariff on imports from Country C. Derive the optimal specific tariff of this customs union that maximizes the joint total surplus of Country A and B, assuming that Country C does not react to such a common external tariff (no tariff and no export subsidy). The optimal specific tariff of the customs union=
There are three countries in the world: Country A, Country B, and Country C. These countries have the following domestic demand and supply functions for product X; SA=PA, DA= 150-PA SB=2PB, DB = 150 Pa; Sc=4Pc, Dc = 150-Pc where subscripts denote countries of the corresponding variables. Now consider a customs union between Country A and Country B under which these countries impose a common external tariff on imports from Country C. Derive the optimal specific tariff of this customs union that maximizes the joint total surplus of Country A and B, assuming that Country C does not react to such a common external tariff (no tariff and no export subsidy). The optimal specific tariff of the customs union=