-The above figure shows the market for rice in Japan where price is expressed in dollars.S represents the domestic supply curve,and the horizontal line at P = $1 represents the world supply curve.Currently Q₁ units are imported.The Consumption distortion loss is equal to

Question

Quizplus · Accepted Answer

The consumption distortion loss refers to the welfare loss to consumers due to the imposition of a tariff or quota that raises the domestic price above the world price. In this scenario, the consumption distortion loss is represented by the areas c + g + i, which are the areas between the domestic supply curve and the world supply curve up to the quantity consumed domestically. These areas represent the extra amount consumers pay over the world price due to the limited domestic supply and the higher price they face.

-The Above Figure Shows the Market for Rice in Japan