The following graph represents the domestic supply and demand for coal. a. In the absence of trade, what is the equilibrium price and equilibrium quantity?b. The government opens the market to free trade, and Indonesia enters the market, pricing coal at $40 per ton. What will happen to the domestic price of coal? What will be the new domestic quantity supplied and domestic quantity demanded? How much coal will be imported from Indonesia?c. After numerous complaints from domestic coal producers, the government imposes a $10 per ton tariff on all imported coal. What will happen to the domestic price of coal? What will be the new domestic quantity supplied and domestic quantity demanded? How much coal will now be imported from Indonesia?d. How much revenue will the government receive from the $10 per ton tariff?e. Who ultimately ends up paying the $10 per ton tariff? Why? Refer to the previous problem. Assume the market is opened to trade and Indonesia still enters the market by pricing coal at $40 per ton. But as a response to complaints from domestic coal producers, instead of imposing a $10 per ton tariff, the government imposes an import quota of 90 million tons on Indonesian coal. How will the results of the quota differ from the results of the tariff?
- Assignment status: Already Solved By Our Experts
- (USA, AUS, UK & CA PhD. Writers)
- CLICK HERE TO GET A PROFESSIONAL WRITER TO WORK ON THIS PAPER AND OTHER SIMILAR PAPERS, GET A NON PLAGIARIZED PAPER FROM OUR EXPERTS