Refer to the figure below: Price A PW+T PW H B C Sus Dus. Quantity 0 (a) If the world price (Pw) is operational in the market, then U.S. imports equal Q2-QI (b) A tariff raises the price in the market from Pw to Pw + T. As a result, U.S. domestic sales rise from Q1 to Q3 (c) Pw is the price that exists in the market before a tariff is imposed and PW + T is the price that exists in the market after a tariff is imposed. The tariff revenue collected by the government is equal to the area BCFE

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