The figure shows the market for shirts in the United States, where D is the U.S demand curve and S is the U.S. supply curve. The world price is $20 per shirt. The United States imposes a tariff on imported shirts, $4 per shirt.
-In the figure above, U.S. producers' ________ from the tariff is ________.

Question

Quizplus · Accepted Answer

The correct choice is "gain; $80 million" because tariffs typically increase domestic producers' revenue by raising the price of imported goods, allowing them to sell more at higher prices.

The Figure Shows the Market for Shirts in the United