Suppose That the World Price of Kiwi Fruit ($10 Per

question 21

Multiple Choice

Suppose that the world price of kiwi fruit ($10 per box) is below the domestic price ($12 per box) .A tariff of $1 per box would:

• A)cause foreign producers to be better off,because the price they charge is now higher by $1 per box.
• B)cause domestic producers to be worse off by $5 per box.
• C)allow domestic consumers to enjoy kiwi fruit for $5 more per box than the free trade price,but still $2 less than the domestic price.
• D)allow domestic consumers to enjoy kiwi fruit for $1 more per box than the free trade price,but still $1 less than the domestic price.
• E)cause domestic producers to be worse off by $10 per box.

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