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Home Q & A Board Other Fields Homework Help Business Economics
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Loraine Loraine
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8 years ago
Suppose that elimination of tariffs on agricultural products means that 1,000 farm workers lose jobs that pay an average of $20,000 per year. At the same time, because of the importation of relatively cheaper foreign vegetables, 150 million 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 outweigh the costs in this simple example?
d.    Which group is most likely to become politically involved over the issue of removing the tariffs, the farm workers or the consumers? Why?
Textbook 
Essential Foundations of Economics

Essential Foundations of Economics


Edition: 7th
Authors:
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Start by doing what's necessary; then do what's possible; and suddenly you are doing the impossible.
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Chimelo46Chimelo46
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8 years ago
Glad to help you, and good luck with your course.
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