The table below gives the domestic demand and supply schedules. Suppose the worl
ID: 2502622 • Letter: T
Question
The table below gives the domestic demand and supply schedules. Suppose the world price for a good is 40$ and the governemnt imposes a 20$ per unit tarriff. How much will the government collect as tarriff. And can someone please explain to me how you get the answer, because I am totally lost.
A. 360
B. 80
C. 240
D. 320
Price (Dollars Per Unit) | Quanity Demanded (Units per day) | Quanity Supplied (Units per day)
..................40 ................................ ................22.......................................................14
.................50 ................................................. 21 ................................ .................... 15
.................60 ..................................................20 ................................ .....................16
..................70 .................................................19 ............................... .....................17
....................80 ...............................................18 ............................... .....................18
.....................90 ............................... ..............17 ............................... .....................19
Explanation / Answer
The table below gives the domestic demand and supply schedules. Suppose the world price for a good is 40$ and the governemnt imposes a 20$ per unit tarriff. How much will the government collect as tarriff. And can someone please explain to me how you get the answer, because I am totally lost.
A. 360
Since as per table The highest revenue can be earned at the price of $ 80, where qty to be sold = 18 unit
Govt will Collect = 20*18 = 360
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