In the figure to the right, the importing country imposes a tariff that raises the domestic price from $8 to $12 but lowers the foreign export price from $8 to $4. The net welfare gain from this tariff for the importing country is O A. $34 B. $4 C. $18 D. $16

In the figure to the right, the importing country imposes a tariff that raises the domestic price from $8 to $12 but lowers the foreign export price from $8 to $4. The net welfare gain from this tariff for the importing country is O A. $34 B. $4 C. $18 D. $16

Principles of Microeconomics (MindTap Course List)

8th Edition

ISBN:9781305971493

Author:N. Gregory Mankiw

Publisher:N. Gregory Mankiw

Chapter9: Application: International Trade

Section: Chapter Questions

Problem 4CQQ

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Question

To help me better understand, can you please show steps to how you got your answer. Thank you.

In the figure to the right, the importing country imposes a tariff that raises the
domestic price from $8 to $12 but lowers the foreign export price from $8 to $4.
The net welfare gain from this tariff for the importing country is
OA. $34
O B. $4
O C. $18
OD. $16
24-
22-
20-
18-
16-
14-
12-
10-
8-
6-
4-
2+
0
Price, P
T
1 2
5
S
\D
9
Quantity, Q
10 11 12

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