As a result of Austria's tape measure trade:
A)producers of tape measures will be better off and consumers of tape measures will be worse off
B)everyone will be better off
C)there will be a deadweight loss as a result of the tariff
D)consumers will consume too many tape measures and producers won't produce enough tape measures

Question

Quizplus · Accepted Answer

The imposition of tariffs on tape measures by Austria will increase the price of imported tape measures, leading to a decrease in demand and consumption of tape measures. This results in a deadweight loss as there will be a reduction in both consumer surplus and producer surplus. Therefore, the correct choice is C.

As a Result of Austria's Tape Measure Trade