Question: Problem 3. (a) Provide a succinct denition of the term optimal tariff in your own words and state the relevance of it in the context

Problem 3. (a) Provide a succinct denition of the term \"optimal tariff\" in your own words and state the relevance of it in the context of trade policy. Under which conditions can imposing a tariff be welfare improving? (b) Consider the following case. The US imports two goods, coke and pepsi (C and P) from Argentina and Brazil respectively (A and B). All these countries are big countries. Assume that they have the following import demand and export supply schedules: D33 : PC = 450 5620 DE3 : Pp = 450 5Qp SRG : PC = 10 + 4630 3,1332 : Pp = 10 + sop Which product should the US government impose the larger tariff on? Why

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