Consider a country that is a net importer of oranges, in a partial-equilibrium comparative advantage model of the same type as the U.S.-ROW sugar model in the text. This is a country that does produce some oranges, but it is a small country in the world orange market.
(a) What is the optimal tariff for this country, assuming that the political decision makers wish to maximize unweighted social welfare?
(b) Suppose that domestic orange growers argue that they should have tariff protection because foreign orange growers benefit from subsidies from their own governments, and as a result, the world price of oranges is artificially (and unfairly) low. Does this observation change your conclusion about the optimal tariff on orange imports for this country? Explain your reasoning very clearly.