The figure given below shows the U.S. market for imported wine. For simplicity, we consider export supply curves to be flat. Chilean wine is available for $480 per barrel and French wine is available for $420 per barrel. Suppose the United States has a tariff of $80 per barrel on imported wine. Then, the U.S. joins a free trade area with Chile. What will be the change in the consumer surplus after the U.S. enters into a free trade agreement with Chile?

Question

The figure given below shows the U.S. market for imported wine. For simplicity, we consider export supply curves to be flat. Chilean wine is available for $480 per barrel and French wine is available for $420 per barrel.  Suppose the United States has a tariff of $80 per barrel on imported wine. Then, the U.S. joins a free trade area with Chile. What will be the change in the consumer surplus after the U.S. enters into a free trade agreement with Chile?

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The Answer of The figure given below shows the U.S. market for imported wine. For simplicity, we consider export supply curves to be flat. Chilean wine is available for $480 per barrel and French wine is available for $420 per barrel.  Suppose the United States has a tariff of $80 per barrel on imported wine. Then, the U.S. joins a free trade area with Chile. What will be the change in the consumer surplus after the U.S. enters into a free trade agreement with Chile?

The Figure Given Below Shows the U