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 free trade,who would be in favor of a tariff?

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 free trade,who would be in favor of a tariff?

Quizplus · Accepted Answer

Domestic producers would be in favor of a tariff because it would cause the domestic price of the good to increase, resulting in a higher quantity supplied by domestic producers and a decrease in the quantity demanded by domestic consumers. This would benefit domestic producers by increasing their revenue and profits.

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