The Graph Above Shows Domestic Supply and Demand with Trade

question 31

Multiple Choice

The graph above shows domestic supply and demand with trade in a SMALL country.With trade,this country can purchase at the world price,Pw.
Suppose that this country imposes a $5 per unit tariff on this good.Which of the following is true?

• A)The domestic price will rise by $5.
• B)Consumers will be better off.
• C)There will not be deadweight losses due to this tariff, since it is a small country.
• D)Producers will not increase domestic production.

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Definitions:

Cultural Pressures

Social forces exerted by the cultural context of a society on individuals to conform to established norms and values.

Family Background

The social, economic, and educational characteristics and environments of one's parents or family of origin.

Genetic Factors

Elements within an organism's genetic makeup that influence traits, behaviors, and their susceptibility to diseases.

Bulimia Nervosa

An eating disorder characterized by episodes of binge eating followed by compensatory behaviors such as self-induced vomiting, aimed at preventing weight gain.