Exhibit 18-5
-In Exhibit 18-5, if the world price of a baseball is $3 and a tariff of $1 per baseball is imposed in the United States, how many baseballs will the United States import?

Question

Exhibit 18-5 
-In Exhibit 18-5, if the world price of a baseball is $3 and a tariff of $1 per baseball is imposed in the United States, how many baseballs will the United States import?

Quizplus · Accepted Answer

The tariff of $1 per baseball raises the domestic price of baseballs to $4. At this price, the quantity demanded in the United States falls to 6,000 baseballs, and the quantity supplied domestically increases to 2,000 baseballs. The United States will therefore import 4,000 baseballs.

Exhibit 18-5 -In Exhibit 18-5, If the World Price of a Baseball