application∶thecostsoftaxation(编辑修改稿)

application∶thecostsoftaxation(编辑修改稿)内容摘要：

tic, the deadweight loss of a tax is large. (b) Elastic Supply Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Tax Distortions and Elasticities... Quantity Price Demand Supply 0 When demand is relatively inelastic, the deadweight loss of a tax is small. (c) Inelastic Demand Size of tax Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Tax Distortions and Elasticities... Quantity Price Demand Supply 0 Size of tax When demand is relatively elastic, the deadweight loss of a tax is large. (d) Elastic Demand Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Deadweight Loss and Tax Revenue... PB Quantity Q2 0 Price Q1 Demand Supply Tax revenue PS Deadweight loss (a) Small Tax Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Demand Supply Tax revenue PB Quantity Q2 0 Price Q1 PS Deadweight loss Deadweight Loss and Tax Revenue... (b) Medium Tax Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. PB Quantity Q2 0 Price Q1 Demand Supply PS Deadweight loss Deadweight Loss and Tax Revenue... (c) Large Tax Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Deadweight Loss and Tax Revenue Vary with the Size of the Tax... (a) Deadweight Loss Deadweight Loss 0 Tax Size Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Deadweight Loss and Tax Revenue Vary with the Size of the Tax... (b) Revenue (the Laffer curve) Tax Revenue 0 Tax Size Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Application: International Trade Chapter 9 Copyright 169。 2020 by Harcourt, Inc. All rights reserved. Requests for permission to make copies of any part of the work should be mailed to: Permissions Department, Harcourt College Publishers, 6277 Sea Harbor Drive, Orlando, Florida 328876777. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. International Trade What determines whether a country imports or exports a good? Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. International Trade Who gains and who loses from free trade among countries? Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. International Trade What are the arguments that people use to advocate trade restrictions? Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Equilibrium Without Trade Assume: A country is isolated from rest of the world and produces steel. The market for steel consists of the buyers and sellers in the country. No one in the country is allowed to import or export steel. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Equilibrium Without Trade... Price of Steel Equilibrium Price 0 Quantity of Steel Equilibrium quantity Domestic supply Domestic demand Producer surplus Consumer surplus Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Equilibrium Without Trade Results: Domestic price adjusts to balance demand and supply. The sum of consumer and producer surplus measures the total benefits that buyers and sellers receive. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. World Price and Comparative Advantage If the country decides to engage in international trade, will it be an importer or exporter of steel? Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. World Price and Comparative Advantage The effects of free trade can be shown by paring the domestic price of a good without trade and the world price of the good. The world price refers to the prevailing price in the world markets.  A country will either be an exporter or an importer of the good. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. World Price and Comparative Advantage If a country has a parative advantage, then the domestic price will be below the world price, and the country will be an exporter of the good. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. World Price and Comparative Advantage If the country does not have a parative advantage, then the domestic price will be higher than the world price, and the country will be an importer of the good. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Price of Steel 0 Quantity of Steel Domestic demand International Trade in an Exporting Country... Domestic supply World price Price after trade Exports Domestic quantity demanded Domestic quantity supplied Price before trade Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Price of Steel 0 Quantity of Steel World price Domestic demand How Free Trade Affects Welfare in an Exporting Country... Domestic supply Price after trade Price before trade A B C D Exports Harcourt, Inc. items and derived items copyright 169。 2020 by Harcourt, Inc. Price of Steel 0 Quantity of Steel World price Domestic demand How Free Trade Affects Welfare in an Exporting Country... Domestic supply Price after trade Price before trade A Consumer surplus before trade B C Producer surplus before trade Harc。