EC334-UMB Hw (Due Nov. 21) Fall 2017 The amount of tariff per unit is $ free tra

Question

EC334-UMB Hw (Due Nov. 21) Fall 2017 The amount of tariff per unit is $ free trade world price (Pw) is . The ad-valorem tariff rate as a percentage of The total revenue from tariff is S The deadweight loss from the tariff is $ Use the ad-valorem tariff rate that you calculated in part (g) as the rate for the finished product. Assume that the country needs to import inputs worth $12 to make this product domestically. Also assume that the tariff rate on these inputs is 50%. The Effective Rate of Protection for this industry under these conditions is %. (4 pts.) Sd 25 20 10 Pwtt Pw Dd 50 80 200 22:5

Explanation / Answer

Tariff per unit=5 and advalorem tariff=25% of world price

Tariff revenue=5*120=600

DWL=1/2*30*5+1/2*25*5=75+62.5=137.5

Part g is required

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