The Diagram Below Shows the Demand and Supply Curves for Refrigerators

question 14

Multiple Choice

The diagram below shows the demand and supply curves for refrigerators in Canada. FIGURE 33-1 Refer to Figure 33-1.Suppose P₀ is the world price.If Canada imposes a tariff causing the price of refrigerators in Canada to rise from P₀ to P₁,the consequence would be that

• A)both domestic production and domestic consumption would decrease by equal amounts.
• B)domestic production will increase from Q₁ to Q₂ and domestic consumption will fall from Q₅ to Q₄.
• C)domestic production will increase from Q1 to Q₃ and domestic consumption will fall from Q₅ to Q₃.
• D)domestic production will exceed domestic consumption.
• E)both domestic production and domestic consumption would increase by equal amounts.