The diagram below shows the domestic demand and supply curves for cotton towels in Canada. The prevailing world price of cotton towels is PW. Assume that all cotton towels are identical.
FIGURE 34- 3
-Refer to Figure 34- 3. If the Canadian government imposes a quota on imported cotton towels of the amount (Q3 - Q2 ) , then domestic towel producers' revenues will be equal to the area
A) E + F + G + H.
B) A + B + C + D.
C) E + F + G.
D) A + B + C + E + F + G + H.
E) A + B + E + F + G.
Correct Answer:
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