Exam 3 review
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The document is a review for an exam on microeconomics chapters 7, 8, and 9. It contains diagrams demonstrating supply and demand curves, consumer and producer surplus, the impacts of price floors and ceilings, and how losses occur when prices are set below the market equilibrium. Key concepts reviewed include equilibrium price and quantity, surplus, and the effects of government intervention in markets using minimum and maximum prices.
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Exam 3 review
- 2. Rules
- 4. Chapters
- 8. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 9. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 10. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 11. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 12. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 13. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 14. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 20. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 21. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 22. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 23. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 24. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 25. Surplus Value Price 100 90 80 Supply 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 33. Surplus Value Price 100 90 80 Supply 70 Consumer Surplus 60 50 40 Producer Surplus 30 Demand 20 10 0 0 1 2 Surplus 250 Less excess production 40 3 4 5 6 7 8 9 10 Quantity
- 34. Surplus Value Price 100 90 80 Supply 70 Consumer Surplus 60 50 40 Producer Surplus 30 Demand 20 10 0 0 1 2 Surplus 250 Less excess production 40 Net Surplus 210 3 4 5 6 7 8 9 10 Quantity
- 38. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 39. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 40. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 41. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 42. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 43. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 44. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 2 3 4 5 6 7 8 9 10 Quantity
- 45. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 Revenue 20 x 3 = 60 2 3 4 5 6 7 8 9 10 Quantity
- 46. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 Revenue 20 x 3 = 60 Loss 210 - 60 = 150 2 3 4 5 6 7 8 9 10 Quantity
- 47. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 Revenue 20 x 3 = 60 Loss 210 - 60 = 150 2 3 4 5 6 7 Producers Lose Money 8 9 10 Quantity
- 48. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 Revenue 20 x 3 = 60 Loss 210 - 60 = 150 2 3 4 5 6 7 Producers Lose Money No surplus 8 9 10 Quantity
- 49. Surplus Value Price 100 90 Supply 80 70 60 50 40 30 Demand 20 10 0 0 1 Cost 70 x 3 = 210 Revenue 20 x 3 = 60 Loss 210 - 60 = 150 2 3 4 5 6 7 Producers Lose Money No surplus Negative surplus 8 9 10 Quantity
- 60. Government Minimum Price Price 100 90 Government Price Minimum 80 Consumer Surplus Supply 70 Consumer Loss Producer Gain 60 50 40 Loss Loss Producer Surplus 30 Demand 20 10 0 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 82. Government Maximum Price Price 100 90 80 Supply Consumer Surplus 70 60 Loss 50 40 Government Price Maximum 30 20 10 0 Loss Consumer Gain Producer Loss Demand Producer Surplus 0 1 2 3 4 5 6 7 8 9 10 Quantity
- 83. Tax Analysis 100 Supply with no tax 90 80 70 60 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 84. Tax Analysis 100 Supply with no tax 90 80 Buyer Surplus 70 60 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 85. Tax Analysis 100 Supply with no tax 90 80 Buyer Surplus 70 60 50 40 Seller Surplus 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 86. Tax Analysis 100 Supply with no tax 90 80 70 60 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 87. Tax Analysis 100 Supply with no tax 90 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 88. Tax Analysis 100 Supply with no tax 90 40 80 70 60 40 50 Tax of 40 SAR 40 30 40 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 89. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 40 80 70 60 40 50 Tax of 40 SAR 40 30 40 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 90. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 91. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 92. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 93. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 94. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 95. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 96. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 97. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 98. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 99. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 100. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 101. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 D 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 102. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 E D 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 103. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 E D 40 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 104. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 E D 40 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 105. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 E D 40 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 106. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Tax of 40 SAR 50 E D 40 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 107. Tax Analysis 100 Supply with 40 SAR tax 90 Supply with no tax A 80 70 B 60 C Taxes 50 E D 40 Tax of 40 SAR 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 108. Tax Analysis 100 Supply with 40 SAR tax 90 Buyers Lose C to deadweight loss and lose B to taxes Supply with no tax A 80 70 B 60 C Taxes 50 E D 40 Tax of 40 SAR 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 109. Tax Analysis 100 Supply with 40 SAR tax 90 Buyers Lose C to deadweight loss and lose B to taxes Supply with no tax A 80 Sellers Lose E to deadweight loss and lose D to taxes 70 B 60 C Taxes 50 E D 40 Tax of 40 SAR 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 110. Tax Analysis 100 Supply with 40 SAR tax 90 Buyers Lose C to deadweight loss and lose B to taxes Supply with no tax A 80 Sellers Lose E to deadweight loss and lose D to taxes 70 B 60 C Taxes 50 E D 40 Tax of 40 SAR Government gains B from buyers and D from sellers 30 20 F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 111. Tax Analysis 100 Supply with 40 SAR tax 90 Buyers Lose C to deadweight loss and lose B to taxes Supply with no tax A 80 70 B 60 Buyers C Sellers Taxes Tax of 40 SAR Total 30 20 0 250 After E D 40 D, E F 125 A 45 F 45 B&D 120 210 Change Taxes 50 A, B, C 125 Lose C 20 Lose B 60 Lose E 20 Lose D 60 Gain B 60 Gain D 60 40 Before Sellers Lose E to deadweight loss and lose D to taxes Government gains B from buyers and D from sellers F 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10 Tax on Seller with shift Supply curve up by the amount of the tax
- 119. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 120. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 121. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 122. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 123. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 124. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 125. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 126. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 127. Export Analysis 100 Domestic Supply 90 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 128. Export Analysis 100 Domestic Supply 90 Exports 7-3=4 80 World Price 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 129. Export Analysis 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 New Demand Domestic & World “kink” 60 Domestic Price 50 40 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 130. Export Analysis 100 Domestic Supply 90 World Price 70 New Demand Domestic & World “kink” B 60 Domestic Price Exports 7-3=4 A 80 50 40 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 131. Export Analysis 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 B 60 Domestic Price New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 132. Export Analysis 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 133. Export Analysis 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 134. Export Analysis Domestic Buyers pay a higher price lose B to Sellers 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 135. Export Analysis Domestic Buyers pay a higher price lose B to Sellers 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10 Domestic Sellers gain D from world market and gain B from domestic buyers
- 136. Export Analysis Domestic Buyers pay a higher price lose B to Sellers 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10 Domestic Sellers gain D from world market and gain B from domestic buyers
- 137. Export Analysis Domestic Buyers pay a higher price lose B to Sellers 100 Domestic Supply 90 World Price Exports 7-3=4 A 80 70 Domestic Price D B 60 New Demand Domestic & World “kink” 50 40 Consumers Lose Producers Win C 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10 Domestic Sellers gain D from world market and gain B from domestic buyers
- 145. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 146. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 147. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 148. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 149. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 150. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 151. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 5 6 7 Total Sales 8 9 10
- 152. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 153. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 154. Import Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 155. Import Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 New Supply Domestic & World “kink” 40 World Price 30 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 156. Import Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” 30 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 157. Import Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 158. Import Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 159. Import Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 160. Import Analysis Domestic Buyers pay a lower price gain D from world sellers and gain B from domestic sellers 100 Domestic Supply 90 80 A 70 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 161. Import Analysis Domestic Buyers pay a lower price gain D from world sellers and gain B from domestic sellers 100 Domestic Supply 90 80 A 70 Domestic Sellers lose B to Buyers 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 162. Import Analysis Domestic Buyers pay a lower price gain D from world sellers and gain B from domestic sellers 100 Domestic Supply 90 80 A 70 Domestic Sellers lose B to Buyers 60 Domestic Price 50 B 40 World Price New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 163. Import Analysis Domestic Buyers pay a lower price gain D from world sellers and gain B from domestic sellers 100 Domestic Supply 90 Consumers Win Producers Lose 80 A 70 60 Domestic Price 50 B 40 World Price Domestic Sellers lose B to Buyers New Supply Domestic & World “kink” D 30 C 20 Imports 7-3=4 10 0 Demand 0 1 2 3 4 Domestic Sales 5 6 7 Total Sales 8 9 10
- 172. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 40 World Price Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 173. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 40 World Price Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 174. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price 50 40 World Price Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 175. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 176. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 177. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 178. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 179. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 180. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 181. Tariff Analysis 100 Domestic Supply 90 80 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 182. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 183. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 B 40 Tariff of 10 30 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 184. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 B 40 C 30 Tariff of 10 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 185. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 B 40 C 30 D Tariff of 10 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 186. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 40 C 30 D B E Tariff of 10 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 187. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 40 C 30 D B E F Tariff of 10 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 188. Tariff Analysis 100 Domestic Supply 90 80 A 70 60 Domestic Price Price with Tariff World Price 50 40 C 30 D B E F Tariff of 10 G 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 189. Tariff Analysis 100 Domestic Supply 90 Consumers Lose Producers Win Government Wins Deadweight Losses 80 A 70 60 Domestic Price Price with Tariff World Price 50 40 C 30 D B E F Tariff of 10 G 20 10 0 Demand 0 1 2 3 4 5 6 7 8 9 10
- 190. Laissez Faire