Exhibit 19.5

-Refer to Exhibit 19.5,which shows the market for wheat for the country of Palatino.S^D is the domestic supply of wheat,and D^D is the domestic demand for wheat.Suppose the world price of wheat is $9 per bushel and a specific tariff of $6 is imposed on each bushel of wheat imported.The total loss in consumer surplus after the tariff is shown by area(s) _____

Question

Exhibit 19.5

-Refer to Exhibit 19.5,which shows the market for wheat for the country of Palatino.S^D is the domestic supply of wheat,and D^D is the domestic demand for wheat.Suppose the world price of wheat is $9 per bushel and a specific tariff of $6 is imposed on each bushel of wheat imported.The total loss in consumer surplus after the tariff is shown by area(s) _____

Quizplus · Accepted Answer

When a tariff is imposed, the domestic price of the good increases, reducing consumer surplus. The areas A, B, C, and D represent the total loss in consumer surplus due to the higher price consumers must pay for both the imported and domestically produced wheat.

Exhibit 19.5 -Refer to Exhibit 19.5,which Shows the Market for Wheat for Market