1) US import demand for French perfumes is given by P = 90 - 3Q, where P is the perfume price ($), Q is the number of imported perfume bottles (in millions) demanded by US consumers. International supply of French perfumes (in dollars and in million bottles) is given by: P = 10 + 2Q. If the US government imposes a $10 import tariff on French perfumes entering the US market. What are the US consumer surpluses before and after tariff?
PLEASE SHOW STEPS:
a. $1300, $1100
b. $278, $178
c. $384, $294
d. $7894, $$2356
e. None of the above.
2) International demand for US apples is given by P = 90 - 3Q, where P is the US apple price in dollars, Q is US apple (in million units) demanded by international consumers. US supply of apples (in dollars and in million units) is given by: P = 10 + 2Q. If the US government provides a $10 per unit apple export subsidy to US apple exporters, what would be the dead-weight loss for the world as a whole in the apple market? Hint: The subsidy reduces the unit cost of apples to the exporters by $10.
Select one, Please show steps:
a. Zero.
b. $6 million
c. $10 million
d. Cannot be calculated from the information given or none of the above.