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True or False: In 2009, the U.S. government imposed a 35% tariff on tires imported from...

True or False: In 2009, the U.S. government imposed a 35% tariff on tires imported from China. (The facts included in this pr

True or False: In 2009, the U.S. government imposed a 35% tariff on tires imported from China. (The facts included in this problem are simplifications from the results of a much larger model.) Tires imported from China all are Tier 3 tires, the lowest-quality tires available in the U.S. Assume for this problem that the tariff was $20. The supply of tires from China is perfectly elastic. Domestic U,S. production of these țires is zero. Before the tariff, the price of these tires was $40. Demand is given by Q = 105 1.5P where Q is in millions of tires per year. Before the tariff, consumer surplus was $1,350.
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Solution: Given govert Tariff imposed - 35ili con tires imported from china) Assumed tariff = $ 20. Domestic us production =p= $70 Consumer susplus - Area between demand are and market price en - boge) Cheight) = $(45) (70-40) = (30) (45) = 15$45 (

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