The U.S. domestic demand schedule and domestic supply schedule for oranges was given in Problem 10. Suppose

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The U.S. domestic demand schedule and domestic supply schedule for oranges was given in Problem 10. Suppose that the world price of oranges is $0.30. The United States introduces an import quota of 3,000 oranges and assigns the quota rents to foreign orange exporters.
a. Draw the domestic demand and supply curves.
b. What will the domestic price of oranges be after introduction of the quota?
c. What is the value of the quota rents that foreign exporters of oranges receive?
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Microeconomics

ISBN: 978-1429283434

3rd edition

Authors: Paul Krugman, Robin Wells

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