Description
Divide domesticPrice minus positive borderPrice by borderPrice for observedWedge and specificWedge by borderPrice for its equivalent.
A trade index or share compares values on a declared price, currency, period, and coverage basis. Changing a denominator or quote orientation can change the interpretation substantially.
Divide domesticPrice minus positive borderPrice by borderPrice for observedWedge and specificWedge by borderPrice for its equivalent.
When to use this tool
Use Price Wedge Ad Valorem Equivalent when you need an explicit trade-ratio or index component.
How to use the tool and how it works
- Enter domesticPrice, borderPrice, specificWedge. Use the units and conventions below.
- Run the tool. Correct any format, range, or cross-field input error before interpreting the output.
- Read observedWedge, suppliedAdValoremEquivalent, residual. Use the output convention below.
Divide domesticPrice minus positive borderPrice by borderPrice for observedWedge and specificWedge by borderPrice for its equivalent. Return domestic minus border minus specific wedge as residual.1
| Input field | Meaning and units | Accepted input |
|---|---|---|
| domesticPrice | Domestic Price | Required. Finite number. |
| borderPrice | Border Price | Required. Finite number; strictly above 0. |
| specificWedge | Specific Wedge | Required. Finite number. |
| Output field | Interpretation | Returned shape |
|---|---|---|
| observedWedge | Observed Wedge | Required. Finite number. |
| suppliedAdValoremEquivalent | Supplied Ad Valorem Equivalent | Required. Finite number. |
| residual | Signed residual using the convention in the calculation paragraph. | Required. Finite number. |
{
"input": {
"domesticPrice": 120,
"borderPrice": 100,
"specificWedge": 15
},
"output": {
"observedWedge": 0.2,
"suppliedAdValoremEquivalent": 0.15,
"residual": 5
}
}Limitations and assumptions
- Price and wedge amounts must share units; the calculation does not attribute the wedge to tariffs or other causes.
- Inputs must satisfy both the field types and the cross-field conditions above. Invalid input causes an error; a successful false flag or documented placeholder is a different result.
- Numeric calculations use binary floating point unless exact decimal-integer arithmetic is explicitly stated. No hidden measurement tolerance or decimal rounding is added; nonfinite or out-of-contract results are rejected. Numeric signed-zero results are exported as zero.
Alternative or Complementary methods
Check source statistical definitions and compatible bases before comparing countries, partners, or time periods.
References
Similar or alternative tools
- Tariff Advalorem Equivalent Term
Divide specificCharge × quantity by positive declaredValue for rateContribution.
- Tariff Quota Rent Per Licensed Unit
Subtract worldPrice and ordinaryTariff from domesticPrice for grossRentPerUnit, then subtract licenseCost for netRentPerUnit and multiply by licensedUnits.