Trump's claim that foreigners will pay the tariffs in full. They assume a small but positive passthrough indicating that domestic prices will rise by 25% of the tariffs.

Their use of elasticity is inconsistent and would not pass an undergraduate test (where is the price effect on the value of imports?) The assumption that exports will be unaffected is crazy. Note also that their (necessary) assumption that domestic import prices will rise contradicts +

But of course this equation and calculation are a travesty. It is a silly attempt to provide a veneer of respectability to a nonsensical, arbitrary, and ad hoc political decision. Whoever produced this (and indeed all the economists working for Trump) should be embarrassed of themselves.