Four months ago Indonesia imposed an import tariff on Hollywood movies. The tariff was meant to protect

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Four months ago Indonesia imposed an import tariff on Hollywood movies. The tariff was meant “to protect local film makers.“ The major Hollywood studios responded by withdrawing their films from Indonesia.

Explain how this tariff influences the price of seeing a movie in Indonesia, the quantity of movies produced in Indonesia, and Indonesia’s gains from trade with the United States. Who, in Indonesia, gains from the tariff and who loses?

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Foundations Of Microeconomics

ISBN: 9780133477108

7th Edition

Authors: Robin Bade, Michael Parkin

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