If Bangladesh is open to international trade in oranges without any restrictions, it will tons of oranges. Suppose the Bangladeshi government wants to reduce imports to exactly 120 tons of oranges to help domestic producers. A tariff of per ton will achieve this. A tariff set at this level would raise $ in revenue for the Bangladeshi government.

Question Completion:

Assume that the price per ton of oranges in the international market is $810 and equilibrium is established at the price of $900 for 120 tons.

If Bangladesh is open to international trade in oranges without any restrictions, it will import tons of oranges. Suppose the Bangladeshi government wants to reduce imports to exactly 120 tons of oranges to help domestic producers. A tariff of $90 per ton will achieve this.  A tariff set at this level would raise $___10,800 in revenue for the Bangladeshi government.

Explanation:

A tariff of $90 per ton will raise the price of a ton of oranges to $900 ($810 per ton as indicated on the question).  When the price is raised to $900 in the domestic market, the quantity demanded will equalize with the quantity supplied at 120 tons.

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