This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good.
According to the graph shown,if the economy was operating under autarky,and decides to open trade with a tariff,the impact on domestic demand is:

Question

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good. 
According to the graph shown,if the economy was operating under autarky,and decides to open trade with a tariff,the impact on domestic demand is:

Quizplus · Accepted Answer

Under autarky, the domestic demand is equal to the domestic supply, which is 1500. However, when the economy opens trade with a tariff, the domestic price rises to the world price plus the tariff, which is $5 + $2 = $7. At this price, the domestic demand curve intersects the world supply curve at a quantity of 1150. Therefore, the impact on domestic demand is an increase from 815 to 1150, which is represented by the movement from point B to point E on the graph.

This Graph Demonstrates the Domestic Demand and Supply for a Good,as