Chapter+9+Application++International+Trade+JBS

=**Chapter 9 Application International Trade JBS **=

**Key Terms **
**World Price**: Price of a good in the world market


 * Tariff**: A type of tax that is imposed on imports 


 Once trade is allowed, //the domestic price rises to equal the world price//. The supply curve shows the quantity of steel produced domestically, and the demand curve shows the quantity consumed domestically. The area D shows the increase in total surplus and represents the gains from trade.


 Once trade is allowed, the domestic price curve shows the amount produced domestically, and the demand curve shows the amount consumed domestically. The area D Shows //the increase in total surplus and represents the gains form trade//. 




A tariff reduces the quantity of imports and moves a market closer to the equilibrium that would exist without trade. Total surplus falls by an amount equal to area D+F. These two triangles represent the deadweight loss from the tariff. 

**Arguments Against Import**


<span style="color: #ff0000; font-family: Tahoma,Geneva,sans-serif;">Bibliography: <span style="font-family: Tahoma,Geneva,sans-serif;"> ==<span style="font-family: Tahoma,Geneva,sans-serif;"> http://www.soorganic.com/blog/wp-content/uploads/2009/04/world-fairtrade-day-09.jpg <span style="color: #ff9800; font-family: 'Palatino Linotype','Book Antiqua',Palatino,serif;"> == <span style="font-family: Tahoma,Geneva,sans-serif;"><span style="color: #ff9800; font-family: 'Palatino Linotype','Book Antiqua',Palatino,serif;"> http://www.nicholsoncartoons.com.au/cartoons/new/2002-11-16%20Free%20trade%20agriculture%20subsidies%20WTO%20protest%201m.JPG