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znanyo

Economics

Econ 201

Saudi electronic university

ECON

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Assignment Question(s): Q. 1. Suppose both supply and demand in a market are relatively inelastic. Will a tax placed on the product in market generate a relatively large or small deadweight loss? Why? Q. 2. If the world price of a good exceeds the domestic price of the good, will the country export or import the good. In this scenario who gain from free trade: Domestic consumers or Domestic producers? Explain. Answer:
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Running Head: ECONOMICS CONCEPTS

1

Economics Concepts and Explanations
Author’s Name
Saudi Electronic University

2
ECONOMICS CONCEPTS

Assignment Question(s):
Q. 1. Suppose both supply and demand in a market are relatively inelastic. Will a tax placed on
the product in the market generate a relatively large or small deadweight loss? Why?

Q. 2. If the world price of a good exceeds the domestic price of the good, will the country export
or import the good. In this scenario who gains from free trade: Domestic consumers or
Domestic producers? Explain.

Answer:
Q. 1
The tax p...


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