(Solved): Refer to the diagram to the right. The closed-economy equilibrium price is $14. The world price is ...

Refer to the diagram to the right. The closed-economy equilibrium price is $\$14$. The world price is $\$6$. By how much will domestic (Home) supply be reduced by allowing international trade? units. (Enter your response as a whole number.) $S=20+20P$ and $D=100-20P$ are Home's supply and demand curves for wheat. $S^{\ast }=40+20P$ and $D^{\ast }=80-20P$ are Foreign's supply and demand curves for wheat. On the graph to the right, show the effects of a specific tariff of $\$0.50$ on wheat imports: 1) Show the price that Home's consumers pay for wheat. Using the line drawing tool, draw a horizontal line at the correct price. Label the line ${\mathrm{P}}_{\mathrm{T}}$. 2) Show Foreign's export price of wheat. Using the line drawing tool, draw a horizontal line at the correct price. Label the line ${\mathrm{P}}_{\mathrm{T}}\ast$. 3) Using the point drawing tool, indicate the quantity supplied by Home. Label the point $Q_{\mathrm{S}}$. 4) Using the point drawing tool, indicate the quantity demanded by Home. Label the point $Q_d$. Carefully follow the instructions above and only draw the required objects. Examine the welfare effects of the tariff: (Round each answer to two decimal places.) 1) The loss of consumer surplus is The nation of Acirema is "small," unable to affect world prices. It imports peanuts at the price of $\$10$ per bag. The demand curve is: $D=400-10\mathrm{P}\text{, }$ and the supply curve is: $S=50+5P\text{. }$ Calculate and graph the following effects of an import quota that limits imports to 50 bags. 1) Using the line drawing tool, draw the nation's supply and demand curves on the graph to the right. Properly label these curves. 2) Indicate the world price without the quota. Using the line drawing tool, draw a horizontal line at the correct price. Label the line $P_w$. 3) Indicate the domestic price with a quota that limits imports to 50 bags. Using the line drawing tool, draw a horizontal line at the correct price. Label the line ${\mathrm{P}}_{\mathrm{q}}$. Carefully follow the instructions above and only draw the required objects. The quota rents are $\$$ (Enter your answer as an integer.)