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.

The annual straight line depreciation for this asset is $400,000

Explanation:

Total cost of the asset = Purchased cost + installation costs

= $7,500,000 +  $300,000 = $7,800,000

The firm uses the straight-line depreciation method, Depreciation Expense each year is calculated by following formula:  

Annual Depreciation Expense = (Cost of Asset − Salvage Value )/Useful Life  

In there, the asset will have salvage value of $1,800,000 and useful life of 15 years

Annual Depreciation Expense = ($7,800,000 - $1,800,000)/15 = $6,000,000/15 = $400,000