Refer to the Information Provided in Figure 4

question 158

Multiple Choice

Refer to the information provided in Figure 4.1 below to answer the question(s) that follow. Figure 4.1
-Refer to Figure 4.1. Assume that initially there is free trade. If the United States then imposes a 10-cent tax per apple,

• A) the quantity of apples demanded will be reduced by 2 million apples per day.
• B) the quantity of apples supplied by U.S. firms will increase by 2 million apples per day.
• C) the price of apples in the United States will increase to 40 cents per apple.
• D) all of the above

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Definitions:

Surpluses

Situations in which the quantity of a good or service supplied exceeds the quantity demanded at a given price.

Migration

The movement of individuals or groups from one location to another, often for reasons such as employment, education, or economic opportunities.

Price Supports

Government interventions to maintain the price of a good or service at a certain level to encourage production and protect producers.

Producers' Income

The earnings or revenue received by the producers or firms from the sale of goods or services before the deduction of any expenses.