Exhibit 28-6 Refer to Exhibit 28-6.After the tariff,domestic consumers

Question

Exhibit 28-6  Refer to Exhibit 28-6.After the tariff,domestic consumers

Quizplus · Accepted Answer

The tariff increases the price of the imported product, causing a decrease in the quantity demanded by domestic consumers. This reduction in the quantity demanded reduces the total consumer surplus. Domestic consumers lose areas C, D, E, and F of consumer surplus, which includes the deadweight loss created by the tariff. Therefore, the best choice is C, as domestic consumers lose areas C+D+E+F of consumer surplus.