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
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
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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Question
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![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](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Ff203800f-68fe-4a5e-90d9-c7f9c79b3b75%2F99260f85-b78a-4d69-b600-dbd3ff22638a%2F1uw8k8h_processed.jpeg&w=3840&q=75)
Transcribed Image Text: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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