Refer to the information provided in Figure 4.4 below to answer the question(s) that follow. Figure 4.4
-Refer to Figure 4.4. Assume that initially there is free trade. The price of oil in the United States will increase to $150 per barrel if the United States then imposes ________ tariff per barrel of imported oil.
A) no
B) a $25
C) a $50
D) a $100

Question

Refer to the information provided in Figure 4.4 below to answer the question(s) that follow.  Figure 4.4
-Refer to Figure 4.4. Assume that initially there is free trade. The price of oil in the United States will increase to $150 per barrel if the United States then imposes ________ tariff per barrel of imported oil.
A) no 
B) a $25 
C) a $50 
D) a $100

Quizplus · Accepted Answer

A $25 tariff on imported oil would raise the cost of imported oil to match the domestic price of $150 per barrel, assuming the initial free trade price was lower than this.

Refer to the Information Provided in Figure 4