Tariffs and quotas annotated

Tariff and Quota Problems Annotated

tariff A tariff is a tax on imports. In thse problems we consider the simplest kind of tariff, the specific tariff, a set tax per unit. Further explanation of tariffs.		quota A quota is a quantitave restriction on the number of units of a good that may be imported in some period. Further explanation of quotas.
small country With a small country, we can assume that the international price will not fall if it buys a smaller quantity. Click here to see the problem that is annotated below.	large country (without domestic production) With a large country, the international price will* fall if it buys a smaller quantity. Click here to see the problem that is annotated below.	small country With a small country, we can assume that the international price will not fall if it buys a smaller quantity. Click here to see the problem that is annotated below.	large country .
before the tariff, with free trade	before the tariff, with free trade	before the quota, with free trade	in the interest of time, we won't do one of these on the exam.
after the tariff is imposed	immediately after the tariff is imposed A. B.	immediately after the quota is imposed
	further adjustment A. B.	further adjustment
winners and losers Review consumer surplus consumers before consumers after consumers' loss Review producer surplus domestic producers before domestic producers after domestic producers' gain government's gain putting it all together	winners and losers Review consumer surplus consumers before consumers after consumers' loss Review producer surplus foreign producers before foreign producers after foreign producers' gain government's gain putting it all together	winners and losers Review consumer surplus consumers before consumers after consumers' loss Review producer surplus domestic producers before domestic producers after domestic producers' gain foreign producers' gain putting it all together

*We assume away domestic production, in the large-country case, for the sake of simplicity.