Consider a Market in Which There Is an Import Tariff

question 190

Multiple Choice

Consider a market in which there is an import tariff. Which of the following is TRUE?

• A) The lost consumer surplus equals the gain in producer surplus plus the government revenue plus the deadweight loss.
• B) The lost consumer surplus equals the gain in producer surplus.
• C) The lost consumer surplus equals the gain in producer surplus plus the government revenue.
• D) The lost consumer surplus plus the deadweight loss equal the gain in producer surplus plus the government revenue.