Home's demand curve for wheat is P = 40 - 1/2 (QD) and supply is p = 10 + 1/2 (QS)
Illustrate graphically the different economic effects if citizens of home are allowed to buy the wheat in foreign markets and the world price is $20
Compute the economic surplus and the consumer surplus
Home imposes a specific tariff of $4 on wheat import. Determine and graph the effects on the tariff on the following groups:
Home import competing producers
Home consumers
Home government
Show graphically and calculate the terms of trade gain, the efficiency loss, and the total effect on welfare of the tariff.