Figure 7.5 Bragabong Currently Both Produces and Imports Almonds. the Government of Imports

question 86

Essay

Figure 7.5

Bragabong currently both produces and imports almonds. The government of Bragabong decides to restrict international trade in almonds by imposing a quota that allows imports of only 10 million kilos each year. Figure 7.5 shows the estimated demand and supply curves for almonds in Bragabong and the results of imposing the quota.
-Use Figure 7.5 to answer questions a-j.
a.If there is no quota what is the domestic price of almonds and what is the quantity of almonds demanded by consumers?
b.If there is no quota how many kilos of almonds would domestic producers supply and what quantity would be imported?
c.If there is no quota what is the dollar value of consumer surplus?
d.If there is no quota what is the dollar value of producer surplus received by producers in Bragabong?
e.If there is no quota what is the revenue received by foreign producers who supply almonds to Bragabong?
f.With a quota in place what is the price that consumers of Bragabong must now pay and what is the quantity demanded?
g.With a quota in place what is the dollar value of consumer surplus? Are consumers better off?
h.With a quota in place what is the dollar value of producer surplus received by producers in Bragabong? Are domestic producers better off?
i.Calculate the revenue to foreign producers who are granted permission to sell in Bragabong after the imposition of the quota.
j.Calculate the deadweight loss as a result of the quota.

Understand Keynes's explanations for the Great Depression and his policy recommendations.

Analyze the effects of shifts in aggregate demand on the economy's output and price level.

Identify the components and regions of the aggregate supply curve.

Grasp the fundamentals of classical economic theory, including the self-regulating nature of markets.

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Definitions:

Affect

A subjective positive or negative evaluation of an object, which can vary in direction, intensity, and activity.

Emotion

A complex psychological state involving three distinct components: a subjective experience, a physiological response, and a behavioral or expressive response.

Mood

A general psychological condition that characterizes an individual’s experience and emotional orientation for hours or even days. Considerably less specific than an emotion.

Charles Darwin

A 19th-century naturalist and geologist best known for his contributions to the science of evolution, especially the theory of natural selection.