Great Deal! Get Instant \$10 FREE in Account on First Order + 10% Cashback on Every Order Order Now

# This is a problem set for 'International Trade' course. There are two problems with 4~5 small questions included.

This is a problem set for 'International Trade' course. There are two problems with 4~5 small questions included.
Answered 1 days After Jun 26, 2022

## Solution

Komalavalli answered on Jun 27 2022
6.
a)
Price
DH
0
18
5
16.75
10
15.5
15
14.25
20
13
25
11.75
30
10.5
35
9.25
40
8
45
6.75
50
5.5
55
4.25
60
3
65
1.75
70
0.5

)
ium where DH (home country demand equation ) equals QF-DF(export supply equation)
18-0.25P = -10+P
28 = 1.25P
P = 28/1.25
P = 22.4
P=22 approximately
Substituting this P in home country demand equation
DH = 18-0.25*22.4
DH = 18-4
DH = 14
Total home countryâ€™s demand is 14 units
We will find the international supply by substituting P in supply equation
-10+22 = 12
Quantity of international supply is 12
Quantity of home country supply at P = 22
QH = -2+0.25*22
QH= -2+5.5
QH = 3
Imports = Home country quantity demand â€“ quantity of home supply
Imports = 14-3
Imports =11 units
c)
With tariff international supply equation will be -10+P+7=-3+P
18-0.25P = -3+P
21 = 1.25P
P =21/1.25
P = 17 approximately
Substituting this P in home country demand equation
DH = 18-0.25*17
DH = 18-4.25
DH = 14
Total home countryâ€™s demand is 14 units
We will find the international supply by substituting P in supply equation
-3+17 = 14
Quantity of international supply is 14
Quantity of home country supply at P = 17
QH = -2+0.25*17
QH=...
SOLUTION.PDF