NOTE : Please provide answer of number 2 also, do not provide half answer (that is only number 1 )

The domestic supply and demand curve of good in an economy are respectively given by QS = 5P QD = 400 - 5P The world price of the good is 10 per unit. (a) Calculate the total welfare, i.e. the total surplus. (b) Now, as the country imposes a specific tariff of 10 per unit on imports, the world price of the good decreases by 5, find the total welfare. (c) How does the tariff as imposed in part (b) impact total welfare? (d) Now, suppose the country imposing this tariff is very small compared to the world market. What would be its welfare implications?

2. Now consider the same demand curve as in question 1, but assume that there is only one producer of this good in this economy. Also, assume that the marginal cost of this firm is constant and equal to 40. (a) Determine the firms quantity and price if the economy is closed. (b) If the world price of this good is 10, what price would this monopoly firm charge if there is free international trade? What quantity would the monopolist sell? What would be the import quantity? (c) Now suppose, the government imposes a tariff of 10 per unit of imported good. What price will the monopoly charge and what amount will it produce and what quantity will i import ( Assume country is small) d) Now, suppose that instead of the tariff, the government imposes an import quota that restrict the quantity imported to the quantity you found in part (b). What price will the monopoly charge and what quantity will it produce? Calculate the quota rents as well. (e) If the government is interested in constraining monopoly power, which of the two policy instrument will it choose?