Explain with DIAGRAMS. Given: Under free trade; a small country imports blankets. The price of a...

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Explain with DIAGRAMS. Given: Under free trade; a small country imports blankets. The price of a blanket is $100.00. A. Suppose the country levies a tariff of $10.00 per blanket. Show the effects of this change in a diagram. Give all welfare effects. Is the country better off or worse off under restricted trade? B. Is it better for the country to use an import tariff or an import quota, if the idea is to protect the domestic blanket industry? Use diagrams to explain. (no need to give numerical answers in part b.) Explain with DIAGRAMS. Given: Under free trade; a small country imports blankets. The price of a blanket is $100.00. A. Suppose the country levies a tariff of $10.00 per blanket. Show the effects of this change in a diagram. Give all welfare effects. Is the country better off or worse off under restricted trade? B. Is it better for the country to use an import tariff or an import quota, if the idea is to protect the domestic blanket industry? Use diagrams to explain. (no need to give numerical answers in part b.)

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From the image it can be observed that a Before tariff c... View the full answer