Warning: foreach() argument must be of type array|object, bool given in /var/www/html/web/app/themes/studypress-core-theme/template-parts/header/mobile-offcanvas.php on line 20

Show graphically that for any tariff, there is an equivalent quota that would give the same result. What would be the difference, then, between the two types of trade barriers?

Short Answer

Expert verified

The graph showing tariff and quota is,

The difference between the two trade barriers is,

Step by step solution

01

Step 1. Meaning of Trade.

Trade refers to the exchange of goods and services between the people of different countries.

The two most common trade barriers are tariffs and quotas.

02

Step 2. The graph shows tariffs and equivalent quotas.

The graph that shows the tariffs and their equivalent quotas are,

The demand and supply for the initial price P, the trade domestic production Q1, the trade domestic consumption Q2, and import would be (Q2-Q1).

When quota is imposed the domestic price isPt, the domestic production isQ3, the domestic production isQ4, and the import quota is(Q4-Q3).

03

Step 3. Difference between the two trade barriers.

The difference between the two trade barriers, quota and tariff is,

Unlock Step-by-Step Solutions & Ace Your Exams!

  • Full Textbook Solutions

    Get detailed explanations and key concepts

  • Unlimited Al creation

    Al flashcards, explanations, exams and more...

  • Ads-free access

    To over 500 millions flashcards

  • Money-back guarantee

    We refund you if you fail your exam.

Over 30 million students worldwide already upgrade their learning with Vaia!

One App. One Place for Learning.

All the tools & learning materials you need for study success - in one app.

Get started for free

Study anywhere. Anytime. Across all devices.

Sign-up for free