--%>

Problem on perfect replacements

Imports and American cars are much close however not perfect replacements. When the U.S. govt. tried to enhance American car sales by setting a price ceiling of P1 on imported cars: (i) The quantity of cars imported will drop/fall from Q0 to Q1. (ii) American car prices would increase to P2. (iii) Foreign car exporters would ship much luxury cars to the United States. (iv) American made car sales would increase by Q2 to Q0.

1763_4.jpg

Can someone help me in getting through this problem.

   Related Questions in Macroeconomics

  • Q : Tax shifting forward totally A tax is

    A tax is shifted forward when the tax burden causes the: (w) consumers to pay higher prices. (x) lower purchasing power for the party bearing the legal incidence. (y) workers to experience lower take home wages. (z) decreased dividends to corporate st

  • Q : Market demand curve for new houses The

    The market demand curve for latest houses would rise in response to a rise in: (1) construction technology. (2) The costs of lumber. (3) Housing prices. (4) Legal price ceilings on rental properties. (5) Expectations regarding future housing prices.

    Q : Policy proposals influencing market for

    How would your policy proposals influence the market for parking?

  • Q : Revenue receipts and Capital receipts

    Elucidate the basis of categorizing government receipts into revenue receipts and capital receipts. Answer: Revenue Receipts: The government revenue receipts are such receipts A) that neither makes liability

  • Q : Problem on perfect replacements Imports

    Imports and American cars are much close however not perfect replacements. When the U.S. govt. tried to enhance American car sales by setting a price ceiling of P1 on imported cars: (i) The quantity of cars imported will drop/fall from Q0 to Q1. (ii)

  • Q : Problem on rational consumption

    Whenever you dine at an “all-you-can-eat” buffet, the rational consumption prototype is to carry on eating till: (1) The restaurant goes bankrupt. (2) You have eaten as much food as it would encompass cost had you made your own meal at hom

  • Q : Why government taken as capital receipt

    Why the borrowings by Government are taken as capital receipts?

  • Q : Main concerns of microeconomics Can

    Can someone explain/help me with best solution about problem of microeconomics in economic... Main concerns of microeconomics would consist of: (w) rates of inflation. (x) consumer options. (y) rates of unemploymen

  • Q : Agency function of Commercial Bank Name

    Name the six agency function of Commercial Bank. Answer: A) Transfer of funds B) Collection of funds C) Purchase and sale of securities. D) Collection of dividends E) Payment of bills &

  • Q : Describe open market operations

    Describe open market operations? What is its consequence on availability of credit? Answer: Open market operations signify the purchase and sale of government secur