Suppose that the equations S = 2P and D = 6 - P represent a small
Country's home supply and home demand curves.If the government
Imposed a 50% tariff on imports, how much revenue would it collect as a
Result of the tariff? (Note: It is possible to consume partial units of this
Product, such as 2.5 units.)
A)$1.50
B)$2.75
C)$0.50
D)$0.75

Question

Quizplus · Accepted Answer

The equilibrium without tariff is found by setting S = D: 2P = 6 - P, giving P = 2 and Q = 4. With a 50% tariff, the price increases to 3, reducing demand to 3 units and supply to 6 units. Imports are 3 units, and the tariff revenue is 0.5 * 3 = $0.75.

Suppose That the Equations S = 2P and D =