Use Figure 1 to Answer Questions

question 45

Multiple Choice

Use Figure 1 to answer questions

-In Figure 1,if the free trade price was $10 and a $5 tariff was imposed on the imports,then how much is the deadweight loss to the society?

• A)10
• B)20
• C)50
• D)90

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Definitions:

Drawee

In financial transactions, the party on whom a check or draft is drawn and who is responsible for paying the specified amount.

Obligated

Being legally or morally bound to do something or to fulfill a contract or promise.

Drawer

The person who issues or writes a negotiable instrument, such as a check, directing the payment of the specified amount of money.

Demand Instrument

A financial instrument that is payable immediately upon demand, such as a check or certain promissory notes.