Question: ECON254 2017-18 BRUNEAU ASSIGNMENT #3 3: EXPORT TARIFF: Suppose the exporter imposes a 2$ tax on exports. (3 points) a) Show how the Export Tariff

ECON254 2017-18 BRUNEAU ASSIGNMENT #3 3: EXPORT TARIFF: Suppose the exporter

ECON254 2017-18 BRUNEAU ASSIGNMENT #3 3: EXPORT TARIFF: Suppose the exporter imposes a 2$ tax on exports. (3 points) a) Show how the Export Tariff affects the Export Supply Curve and Equilibrium World prices. (3 points) b) What happens to free-trade equilibrium output, consumption, and imports/exports in each country when the import tariff is imposed. Show in a diagram and explain. (2 points) c) Does HOME gain from this (eg does the surplus rise)? Show and explain. EG identify what happens to consumer and producer surpluses in Home due to the tariff. (2 point) d) Does FOREIGN surplus rise? Show and explain. EG identify what happens to consumer and producer surpluses in Home

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