In the U.S.steel market,a "Buy American" provision in the 2009 stimulus package would
A) convert some consumer surplus to deadweight loss.
B) transfer some deadweight loss to producer surplus.
C) transfer some producer surplus to consumer surplus.
D) reduce the producer surplus received by foreign manufacturers.

Question

Quizplus · Accepted Answer

A "Buy American" provision would likely increase prices by restricting competition, converting some consumer surplus into deadweight loss due to higher prices and reduced consumption.

In the USSteel Market,a "Buy American" Provision in the 2009 Stimulus Package