Suppose that a tariff increases domestic production of a good from 25 million units to 75 million units and raises the domestic price by $1.50. Assuming a linear domestic supply curve and a perfectly elastic world supply curve, what is the value of the resources wasted by increased domestic production?
A) $37.5 million
B) $50 million
C) $75 million
D) $150 million
Correct Answer:
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Q70: Without trade restrictions the price of tennis
Q71: Use the following to answer questions:
Figure: Costs
Q72: Use the following to answer questions:
Figure: Foreign
Q73: Use the following to answer questions:
Figure: World
Q74: Use the following to answer questions:
Figure: Costs
Q76: Use the following to answer questions:
Figure: A
Q77: Use the following to answer questions:
Figure: World
Q78: Use the following to answer questions:
Figure: Costs
Q79: Economists consider tariffs to be:
A) necessary.
B) beneficial
Q80: One of the costs of protectionism is:
A)
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