Figure 9-2

Suppose the U.S. government imposes a $0.40 per pound tariff on rice imports. Figure 9-2 shows the impact of this tariff.
-Refer to Figure 9-2.The tariff revenue collected by the government equals the area

Question

Figure 9-2
  
Suppose the U.S. government imposes a $0.40 per pound tariff on rice imports. Figure 9-2 shows the impact of this tariff.
-Refer to Figure 9-2.The tariff revenue collected by the government equals the area

Quizplus · Accepted Answer

Tariff revenue is equal to the tariff rate (0.40) multiplied by the quantity of imports after the tariff (Q2-Q1). In Figure 9-2, this is represented by the rectangular area E. Therefore, the tariff revenue collected by the government equals E.

Figure 9-2 Suppose the U.S. Government Imposes a $0.40 Per Pound Tariff