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.The world price is $20 per shirt.Canada imposes a tariff on imported shirts of $4 per shirt.
Figure 7.3.1
-Refer to Figure 7.3.1,with the tariff Canada imports ________ million shirts per year.
A)24
B)8
C)32
D)16
E)40

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.The world price is $20 per shirt.Canada imposes a tariff on imported shirts of $4 per shirt.
Figure 7.3.1
-Refer to Figure 7.3.1,with the tariff Canada imports ________ million shirts per year.
A)24 
B)8 
C)32 
D)16 
E)40

Quizplus · Accepted Answer

With the tariff, the price of imported shirts increases to $24 per shirt ((world price of $20) + (tariff of $4)). At this price, Canada will import 16 million shirts per year, which is the quantity where the domestic supply and demand curves intersect at a price of $24.

Refer to the Figure Below to Answer the Following Questions