Refer to the figure below to answer the following questions.
The figure shows the market for shirts in Canada, where D is the domestic demand curve and S is the domestic supply curve.world price is $20 per shirt.Canada imposes a tariff on imported shirts of $4 per shirt.
Figure 15.3.1
-Refer to Figure 15.3.1.With the tariff, Canada imports _______ million shirts per year.

Question

Refer to the figure below to answer the following questions.
  The figure shows the market for shirts in Canada, where D is the domestic demand curve and S is the domestic supply curve.world price is $20 per shirt.Canada imposes a tariff on imported shirts of $4 per shirt.
Figure 15.3.1
-Refer to Figure 15.3.1.With the tariff, Canada imports _______ million shirts per year.

Quizplus · Accepted Answer

With the tariff, the new world price for shirts in Canada is $24 per shirt (the $20 world price plus the $4 tariff). At this price, domestic supply is 24 million shirts and domestic demand is 40 million shirts. Therefore, Canada imports 16 million shirts per year (40 million shirts demanded domestically minus 24 million shirts supplied domestically). The best choice is B because it correctly identifies the amount of imports with the tariff.

Refer to the Figure Below to Answer the Following Questions