💬 👋 We’re always here. Join our Discord to connect with other students 24/7, any time, night or day.Join Here!

View Video Answer

Like

Report

Assume two countries, Thailand (T) and Japan (J), have one good: cameras. The demand (d) and supply (s) for cameras in Thailand and Japan is described by the following functions: QdT= 60 – PQsT= –5 + 14P QdJ= 80 – PQsJ= –10 + 12PP is the price measured in a common currency used in both countries, such as the Thai Baht.a. Compute the equilibrium price (P) and quantities (Q) in each country without trade.b. Now assume that free trade occurs. The free- trade price goes to 56.36 Baht. Who exports andimports cameras and in what quantities?

a) 52 Baht, 8, 60 Baht, 20b) The free trade price of camera is 56.36 Baht. The price of camera in $T$ is 52 Baht while price of camera in $J$ is 60 Baht, so price is more than trade price of camera in $J$ and price of camera is less than trade price of camera in $T .$ So, T will be the one who will be exporting cameras ad J will be importing them.

No Related Courses

Chapter 20

Globalization and Protectionism

Introduction

How Markets Work

Markets and Welfare

The Economics of the Public Sector

Topics for Further Study

04:18

For a product, the demand …

27:32

Supply and Demand Suppose …

02:32

Suppose that the quantity …

02:43

In Example $8,$ the demand…

02:41

As background you need to …

03:32

You need to have read the …

Demand The demand x for a …

03:37

Setting Production Scheclu…

02:36

02:29

Suppose the supply and dem…

02:30

09:13

The demand curve for a pro…

00:22

Demand equations The numbe…

08:13

Market equilibrium: In a f…

05:08

02:22

As the price of a product …

03:38

05:41

Law of Supply and Demand. …

04:44

(Modeling) Equilibrium Dem…

04:15

Suppose that a market is d…

all right. So for party, here is the graph of the demand curve in red and the supply curve in black 50 is some were here, which is slightly above the intersection. V. Plugging in P equals 50 in both curves and solving. For Q. We find that the consumer quantity is about 86.64 and the supplier 20 is a load hundreds and that will make the price go down the market forces for pushed a price. Duh. Now, to find equilibrium, we have to solve this nonlinear system of equations, find the intersection and doing so we find the equilibrium. Quantity is about 91.2 and the Caribbean price is 48.2. Indeed, the Caribbean prices lower than 50. So here, observation that party is correct. It agrees with that. Now we need to calculate. Okay, so the consumer surplus he's the area officiated region in red. You choose the into girl from zero toothy equilibrium quantity, which is about 91 point tours be said off. The demand occur which is 100 times e to the negative point. 08 que minus Stay Caribbean price. And this is about 2077 point six. This number represents the gain that consumers get by buying it the equilibrium price rather than the maximum price they're willing to pay now for the supplier or the producer serpents. We have to look at this area in blue, which is also given my name to girl from zero to equilibrium quantity. This time the equilibrium price comes first, minus four times square root. If the quantity plus 10 and this integral is about 1161 0.6 and this number represents the game that suppliers can't from selling it take a Libyan price rather than the minimum price, they're willing to do so.

View More Answers From This Book

Find Another Textbook

For a product, the demand curve is $p=100 e^{-0.008 q}$ and the supply curve…

Supply and Demand Suppose that the demand and price for a certain model of a…

Suppose that the quantity supplied $S$ and quantity demanded $D$ of T-shirts…

In Example $8,$ the demand and supply curves are given by $q=100-2 p$ and $q…

As background you need to have read the discussion on supply and demand prec…

You need to have read the discussion on supply and demand preceding Example …

Demand The demand x for a camera is given by$$p=500-0.5\left(e^{0.00…

Setting Production Scheclules The Pentkon Camera Co. determines that the sup…

Supply and Demand Suppose that the quantity supplied $S$ and the quantity de…

Suppose the supply and demand equations for printed T-shirts in a resort tow…

The demand curve for a product is given by $q=$ $120,000-500 p$ and the supp…

Demand equations The number of photo scanners that consumers buy depends on …

Market equilibrium: In a free-enterprise (supply and demand) economy, the am…

As the price of a product increases, businesses usually increase the quantit…

Law of Supply and Demand. The demand function, graphed below, describes the …

(Modeling) Equilibrium Demand and Price The supply and demand equations for<…

Suppose that a market is described by the following supply and demand equati…

06:00

How can governments identify good candidates for infant industry protection?…

00:45

Look at Table 19.3. Is there a range of trades for which there will be no ga…

00:40

Microeconomic theory argues that it is economically rationale (and profitabl…

00:32

Why might a tax on domestic consumption of resources critical for national s…

01:12

Is it legitimate to impose higher safety standards on imported goods that ex…

02:25

You have just been put in charge of trade policy for Malawi. Coffee is a rec…

03:15

Trade has income distribution effects. For example, suppose that because of …

04:23

Why do you think that the GATT rounds and, more recently, WTO negotiations h…

07:07

Economists sometimes say that protectionism is the “second-best” choice for …

00:50

How does comparative advantage lead to gains from trade?