Exhibit 19-5

-Refer to the graph in the exhibit.Suppose the world price of a baseball is $3, and Canada imposes a tariff of $1 per baseball.How many baseballs will be purchased in Canada?

Question

Exhibit 19-5
 
-Refer to the graph in the exhibit.Suppose the world price of a baseball is $3, and Canada imposes a tariff of $1 per baseball.How many baseballs will be purchased in Canada?

Quizplus · Accepted Answer

With a tariff of $1, the new domestic price in Canada will be $4. At that price, Canada will demand 10,000 baseballs. This is determined by following the quantity demanded at the new price of $4 up to the demand curve.

Exhibit 19-5 -Refer to the Graph in the Exhibit.Suppose the World Price