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ECN150 module 8 assignment

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Question;Directions;Please answer each of the following questions in a paragraph for each. Explain your thoughts with theory and;examples where applicable.;1. Explain;the difference between absolute advantage and comparative advantage. Which is more important in determining trade;patterns, absolute advantage or comparative advantage? Why?;2. What;are the arguments in favor of trade restrictions, and what are the;counterarguments? According to most;economists, do any of these arguments really justify trade restrictions? Explain.;3. Using;the graph, assume that the government imposes a $1 tariff on hammers. Answer the following questions given this;information.;a. What is;the domestic price and quantity demanded of hammers after the tariff is;imposed?;b. What is;the quantity of hammers imported before the tariff?;c. What is;the quantity of hammers imported after the tariff?;d. What would;be the amount of consumer surplus before the tariff?;e. What would;be the amount of consumer surplus after the tariff?;f. What;would be the amount of producer surplus before the tariff?;g. What would;be the amount of producer surplus after the tariff?;h. What would;be the amount of government revenue because of the tariff?;i. What;would be the total amount of deadweight loss due to the tariff?

 

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