Use Figure 1 to answer questions

-In Figure 1,if the free trade price was $10 and a $5 tariff was imposed on the imports,then how much is the deadweight loss to the society?
A)10
B)20
C)50
D)90

Question

Use Figure 1 to answer questions

-In Figure 1,if the free trade price was $10 and a $5 tariff was imposed on the imports,then how much is the deadweight loss to the society?
A)10 
B)20 
C)50 
D)90

Quizplus · Accepted Answer

The deadweight loss to society from a tariff is represented by the loss in consumer and producer surplus that is not offset by government revenue. In this case, without specific details from Figure 1, the general approach to calculate deadweight loss involves understanding the reduction in quantity traded due to the tariff and the increase in price. The deadweight loss is typically illustrated as the triangular area between the supply and demand curves, from the free trade price to the price after the tariff. Without the ability to see Figure 1, the correct answer cannot be directly calculated from the information provided. However, assuming choice B (20) is correct, it would imply that based on the given options and the typical analysis of tariffs, the deadweight loss calculated or assumed from the details provided (or possibly from a standard analysis of tariffs in economic theory) equals 20. This answer is contingent on specific details from Figure 1 that are not provided, making it a theoretical or assumed response based on the options given.

Use Figure 1 to Answer Questions