In 2011, Argentina wanted to protect manufacturing workers, so it imposed a 35 percent tariff on imported

Question:

In 2011, Argentina wanted to protect manufacturing workers, so it imposed a 35 percent tariff on imported smartphones, computers, and tablets. Blackberry moved jobs to Argentina, but Apple and others passed. Compare Argentine and U.S. prices: iPhone 7 Plus $1,400 versus

$869; iPad Pro $1,300 versus $699. Argentina is now removing this tariff.

a. Explain how Argentina’s tariff on smartphone and tablet imports changes the country’s production, consumption, and imports of these items. Illustrate your answer with an appropriate graphical analysis.

b. Show on your graph the changes in consumer surplus and producer surplus that result from the tariff on smartphones and tablets.

c. Who in Argentina will oppose the tariff cuts?

Step by Step Answer:

Related Book For  book-img-for-question

Microeconomics

ISBN: 9780134744476

13th Edition

Authors: Michael Parkin

Question Posted: