Question

please only do problem d e and f thanks!

D) Imports at the world price = 30000-9000 = 21000

Imports at the world price+tariff = 24000-13500 = 10500

so, Imports decreases after the imposition of the tariff

E) CS under free trade = A+B+C+D+E+F = 0.5*30000*(0.42-0.12) = 15000*0.3 = 4500

CS under tariff = A+F = 0.5*24000*(0.42-0.18) = 2880

CS decreases by 4500-2880 = 1620

PS under free trade = G = 0.5*9000*(0.12-0) = 540

PS under tariff = B+G = 0.5*13500*(0.18-0) = 1215

PS increases by 1215-540 = 675

F) DWL = C+E = 0.5*(13500-9000)*0.06 + 0.5*(30000-24000)*0.06

= 135+180 = 315

Government revenue = D = 10500*0.06 = 630

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