HSC · Economics · Australia and the global economy live from the app

Free trade and protection

An import-competing market has three lines: domestic demand, domestic supply and a flat world price that lets imports fill the gap between what locals buy and what locals make. Free trade sits at that world price with the biggest import gap and the lowest consumer price. Every protection tool closes the gap by moving one line: a tariff lifts the price line, a quota caps the gap so the price rises to clear it, and a subsidy shifts domestic supply out while the price stays at the world level. All three raise domestic output and create a deadweight loss; they differ in who pays and who collects. This is the real knowscape from knowhere, not a picture of one. Drag it. Watch what actually changes.

economics · australia and the global economy · free trade and protectiondrag it · it is yours
in the wild

Free trade works like the door at a gig.

Every part of this topic is one argument: openness to the world grows the pie but doesn't decide who gets the slices. Trade, globalisation, investment flows, development — each is a case of the same trade-off between efficiency and equity, at home and between nations. The exam wants you to name the gain and name who pays for it.

Tight door checks hold most of the crowd back — few slip inside.

Staff drop the barrier; suddenly people flow through fast.

Almost everyone's inside now, still streaming through the open door.

what examiners catch — Students draw the tariff diagram and then describe a subsidy with the same higher consumer price, or label quota rent as government revenue. The marks come from showing a subsidy shifts domestic supply while price stays at the world price, and from labelling each area (revenue, rent or cost, and deadweight loss) on the diagram.
what you leave with

five things, not forty.

what's underneath

nothing here is a standalone fact.

knowhere maps every concept to what it rests on and what rests on it — 4 underneath this one, 1 built on top. Each one says why, in a sentence, not as an arrow on a diagram.

this conceptfree trade and protectionA linear import-competing market with demand, supply and a dashed world price.
sits under itmarket equilibrium and price mechanismbecause The diagram is a demand and supply market with a world price line added.
sits under itwho really pays a taxbecause A tariff is a tax on imports; incidence and revenue areas use the same reading.
sits under itwhy market equilibrium is efficientbecause Deadweight loss triangles rely on surplus reasoning.
sits under itthe production possibilities frontierbecause Comparative advantage and opportunity cost underpin the case for trade.
built on itglobalisation and competitivenessbecause Trade exposure is why the cost comparison matters in the first place.
the rest of australia and the global economy

3 more, same treatment.

Each one is its own knowscape in the app — built for how a particular student takes things in, not one explanation handed to everybody.

global development and equityin the appglobal investment flows and financial stabilityin the appglobalisation and competitivenessin the app
this is one of 865

they don't read it. they run it.

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