Question

Until about 2006, the European Union guaranteed a price of sugar for its farmers that was...

Until about 2006, the European Union guaranteed a price of sugar for its farmers that was roughly double the world level.

a. Using a well-labeled diagram of the market for sugar within the EU, show the effect of this policy on the price of sugar within the EU, and the incomes of sugar-beet farmers.

b. The EU then sold the “surplus” sugar on the world market. On a well-labeled diagram of the sugar market in the rest of the world, show the effect of these sales on the world price of sugar.

c. The US has a strict import quota (i.e. limit) on sugar. What effect does this have on the price of sugar in the US? Explain, with the help of a diagram. [Background: Americans are expected to consume about 11.1 million tons of sugar in 2018/19 (May to April), of which 1.3 m tons come from Mexico (from which it may be imported somewhat freely), and 1.2 m tons is imported from elsewhere, under strict quotas. The rest is produced domestically, with roughly equal amounts coming from sugar beet (55%) and from sugar cane (45%).]

d. Suppose that the US were to allow unimpeded imports of sugar from the rest of the world, where the cost of producing sugar is relatively low. Show the effect of this on the market for sugar in the U.S., noting any gains or losses for consumers and/or producers.

e. “Lifesavers” (a type of candy) used to be made in Michigan but are now manufactured in Canada. Suggest a reason for why the factory moved.

0 0
Add a comment Improve this question Transcribed image text
Know the answer?
Add Answer to:
Until about 2006, the European Union guaranteed a price of sugar for its farmers that was...
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for? Ask your own homework help question. Our experts will answer your question WITHIN MINUTES for Free.
Similar Homework Help Questions
  • Below is a graph of the market for sugar in the United States. (assume US is...

    Below is a graph of the market for sugar in the United States. (assume US is a small country The World Price of Sugar is 80. USE ONLY NUMBERS ON THE GRAPH 5 130 1 80 110 100 90 8o 70 à00 300 400 500 bo 1. How much sugar is imported with free trade? 2. If a quota of 200 is placed on sugar imports how much sugar is imported? 3. What is the price of sugar in the...

  • In many cases, the reason tariffs and quotas are imposed is that they create net benefits...

    In many cases, the reason tariffs and quotas are imposed is that they create net benefits in the long run. they reduce import dependence. their costs are spread among many people and their benefits are concentrated. their costs are concentrated and their benefits are spread among many people. DQuestion 20 1 pts Usually the removal of trade barriers affecting a particular good benefits domestically, each of whom gains a people a few little many; lot a few lot many: little...

  • Include correctly labeled diagrams, if useful or required, in explaining your answers. A correctly labeled diagram must have all axes and curves clearly labeled and must show directional changes.

    Microeconomics FRQInclude correctly labeled diagrams, if useful or required, in explaining your answers. A correctly labeled diagram must have all axes and curves clearly labeled and must show directional changes. If the question prompts you to "Calculate," you must show how you arrived at your final answer. Question 2 Assume that Grainland currently produces wheat and does not trade wheat in international markets. (a) Draw a correctly labeled demand and supply graph for the domestic wheat market in Grainland. Label the equilibrium price,...

  • Quotas - Welfare Analysis Exercise 1 The graphs below show the market for apricots in the...

    Quotas - Welfare Analysis Exercise 1 The graphs below show the market for apricots in the United States, a nation that is open to international trade but is assumed to be a price taker unable to affect the world price of apricots. a. In the graph below, identify the areas that represent the consumer surplus (CS) and producer surplus (PS) with international trade. Instructions: Use the tools provided 'CS' and 'PS' to illustrate these areas on the graph. Market for...

  • Microeconomics FRQInclude correctly labeled diagrams, if useful or required, in explaining your answers. A correctly...

    Microeconomics FRQInclude correctly labeled diagrams, if useful or required, in explaining your answers. A correctly labeled diagram must have all axes and curves clearly labeled and must show directional changes. If the question prompts you to "Calculate," you must show how you arrived at your final answer. Price per case 0 1 2 3 4 5 6 7 8 9 10 Quantity (millions of cases) Question 1 Assume that sugar-based soft drinks are produced in a market shown on the graph above....

  • (10 marks) Suppose the market for apples is represented by: Supply: Demand: QP Q=36-3P Find the...

    (10 marks) Suppose the market for apples is represented by: Supply: Demand: QP Q=36-3P Find the market cquilibrium price and quantity. (2 marks) b. Find the price elasticity of demand at the equilibrium. (3 marks) Suppose bad weather results in a poor harvest of apples. Using the price elasticity calculated in (b), explain its effect on the total revenue of the apple farmers (5 marks) S2 Assignment 1 v2.docx (9 marks) In December 2019, The Travel Industry Council of Hong...

  • Part II. Problem-solving questions Consult Figure below to finish blanks in Question 16 and 17. Curve...

    Part II. Problem-solving questions Consult Figure below to finish blanks in Question 16 and 17. Curve SS represents a domestic supply curve for some good X; if X is a competitive industry, then SS represents the horizontal sum of the marginal cost curves of many firms. Curse DD represents domestic demand for the same good. It is implicitly assumed that consumers do not care where the good was made, they simply want to buy the indicated quantities at the indicated...

  • Chapter overview 1. Reasons for international trade Resources reasons Economic reasons Other reasons 2. Difference between...

    Chapter overview 1. Reasons for international trade Resources reasons Economic reasons Other reasons 2. Difference between international trade and domestic trade More complex context More difficult and risky Higher management skills required 3. Basic concept s relating to international trade Visible trade & invisible trade Favorable trade & unfavorable trade General trade system & special trade system Volume of international trade & quantum of international trade Commodity composition of international trade Geographical composition of international trade Degree / ratio of...

  • Stephen, MN heveUSDOT 0 Betsy Jensen stands near one of the farm trucks parked at the family farm near Stephen, Minn., on Monday. Dan Gunderson | MPR News Now that spring has finally arrived...

    Stephen, MN heveUSDOT 0 Betsy Jensen stands near one of the farm trucks parked at the family farm near Stephen, Minn., on Monday. Dan Gunderson | MPR News Now that spring has finally arrived in Minnesota, the Jensen family is scrambling to get crops planted on their northern Red River Valley farm. But the usual optimism of a spring planting season is tempered this year by worries about the ongoing trade dispute between the United States and China. China has...

  • Can someone help me with this queshtion I do not understand it for anything. I been...

    Can someone help me with this queshtion I do not understand it for anything. I been struggling with 2 days and its really confusing. Its only one queshtion but has 2 parts I need to shift the curves in the graph and answer the question down but its really tricky. Can anyone help me. This was the only way I can post it. It starts from where it says IT STARTS HERE. NAFTA: Breaking Up Is Hard to Do Paul...

ADVERTISEMENT
Free Homework Help App
Download From Google Play
Scan Your Homework
to Get Instant Free Answers
Need Online Homework Help?
Ask a Question
Get Answers For Free
Most questions answered within 3 hours.
ADVERTISEMENT
ADVERTISEMENT