Effects of the Imposition of Export Tax using Demand and Supply (Essay Sample)

Effects of the Imposition of Export Tax using Demand and Supply
Name
Institution
Introduction
Demand and supply are models of the fundamental foundation of all economic activities in the economy. Demand refers to how much or the number of goods and services that customers desire. Supply, on the other hand, refers to what producers are able to bring to market. The relationship between demand and prices is determined on the quantity of a commodity demanded, implying at a certain price with all factors remaining constant, is the amount people/customers willing to buy. Supply for quantity supplied, which depends at a certain price with all other factors remaining constant, is what producers are able to bring to the market (Croxton, Lambert, García‐Dastugue & Rogers, 2002). Considering the illustration below, we will use a partial equilibrium diagram to identify the effect of an import taxes on the producer and consumer groups and the government in the importing country and evaluate net welfare effect. (Croxton, Lambert, García‐Dastugue & Rogers, 2002).