Back to Assignment Attempts 16. Study Questions # 16. Ch 3. Assume that the United States, as a steel-importing nation,

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Back To Assignment Attempts 16 Study Questions 16 Ch 3 Assume That The United States As A Steel Importing Nation 1 (324.82 KiB) Viewed 35 times

Back to Assignment Attempts 16. Study Questions # 16. Ch 3. Assume that the United States, as a steel-importing nation, is large enough so that changes in the quantity of its imports influence the world price of steel. The following table shows the U.S. supply and demand schedules for steel, along with the overall amount of steel supplied to U.S. consumers by domestic and foreign producers. Price Quantity Supplied (Dollars per ton) (Domestic) (Domestic plus Imports) 100 0 200 PRICE (Dollars perton) 822 800 700 600 500 Using the data in the table, use the blue points (circle symbol) to plot the demand curve and use the orange points (square symbol) to plot the supply curve (domestic plus imports) on the following graph. Then use the black cross to indicate the equilibrium price and quantity 400 Using the data in the table, use the blue points (circle symbol) to plot the demand curve and use the orange points (square symbol) curve (domestic plus imports) on the following graph. Then use the black cross to indicate the equilibrium price and quantity. 300 200 300 400 500 600 700 100 30 Average / 4 10 2 4 8 12 16 With free trade, the equilibrium price of steel is S 20 18 10 -2 QUANTITY (Tons of steel) with free trade, the equilibrium price of steel is The new equilibrium is tons are supplied by U.S. producers, and 18 tons are imported. Quantity Demanded 13 20 12 per ton. At this price, Demand tons are imported. Supply s free Grade Equilibrium Supply per ton. At this price, Free trade Equilibrium Suppose that to protect its producers from foreign competition, the U.S. government levies a specific tariff of $250 per ton on steel imports. Which of the following best describes the effect of the tariff? O The free trade demand curve shifts to the left by an amount equal to the amount of the tariff. The free trade supply curve shifts to the left by an amount greater than the amount of the tariff. amount equal to the amount of the tariff. The free trade supply curve shifts to the left by an The free trade demand curve shifts to the left by an amount greater than the amount of the tariff. tons are purchased by U.S. buyers, On the previous graph, use the purple point (diamond symbol) to plot the new world supply curve after the tariff is imposed. Then use the grey point (star symbol) to indicate the equilibrium point given the tariff of $250 tons of steel traded at tons are purchased by U.S. buyers. per ton. At this price, U.S. producers supply Grade It Now tons, and Save & Continue Continue without saving