Refer to the Information Provided in Figure 18

question 64

Multiple Choice

Refer to the information provided in Figure 18.4 below to answer the questions that follow. Figure 18.4
-Refer to Figure 18.4. The domestic price of a leather wallet is $20. With free trade the price of a leather wallet is $10 and after a tariff is imposed the price is $15. After the tariff is imposed,

• A) domestic production and consumption will increase by 50 wallets and domestic consumption will increase by 50 wallets.
• B) domestic production will increase by 150 wallets and domestic consumption will decrease by 250 wallets.
• C) domestic production will increase by 100 wallets and domestic consumption will decrease by 100 wallets.
• D) domestic production will increase by 50 wallets and domestic consumption will decrease by 50 wallets.