Suppose that elimination of tariffs on agricultural products means that 1,000 farm workers lose jobs that pay an of $20,000 per year. At the same time, because of the importation of relatively cheaper foreign vegetables, 150 mi consumers save $2 per year on their grocery bills.
a) What is the total income lost by farm workers because of the free trade?
b) What is the total dollar amount saved by all consumers combined?
c) Which is greater, the lost income or the consumer savings? Do the benefits of free trade out- weigh the costs i simple example?
d) Which group is most likely to become politically involved over the issue of removing the tariffs, the farm wo or the consumers? Why?

Question

Quizplus · Accepted Answer

The Answer of Suppose that elimination of tariffs on agricultural products means that 1,000 farm workers lose jobs that pay an of $20,000 per year. At the same time, because of the importation of relatively cheaper foreign vegetables, 150 mi consumers save $2 per year on their grocery bills.
a) What is the total income lost by farm workers because of the free trade?
b) What is the total dollar amount saved by all consumers combined?
c) Which is greater, the lost income or the consumer savings? Do the benefits of free trade out- weigh the costs i simple example?
d) Which group is most likely to become politically involved over the issue of removing the tariffs, the farm wo or the consumers? Why?

Suppose That Elimination of Tariffs on Agricultural Products Means That