Tariff Question (1 Viewer)

Kangaaroo

Member
Joined
Jun 30, 2016
Messages
70
Location
Sydney
Gender
Male
HSC
N/A
Screen Shot 2020-05-30 at 11.09.16 am.png

My answer was C, but the correct answer is D. Can anyone help out? (from 2011 HSC).
 

ultra908

Active Member
Joined
May 11, 2019
Messages
159
Gender
Male
HSC
2020
previously, foreign producers fill the 300 quantity gap between supply and demand at $10, so revenue is $3000. With the tariff, foreign producers only fill a 100 quantity gap. While the price is $15, $5 goes directly to the government as 'government revenue'. So foreign producer revenue is only 100*$10=$1000.
Thus D.
 

Kangaaroo

Member
Joined
Jun 30, 2016
Messages
70
Location
Sydney
Gender
Male
HSC
N/A
previously, foreign producers fill the 300 quantity gap between supply and demand at $10, so revenue is $3000. With the tariff, foreign producers only fill a 100 quantity gap. While the price is $15, $5 goes directly to the government as 'government revenue'. So foreign producer revenue is only 100*$10=$1000.
Thus D.
Thanks
 

Users Who Are Viewing This Thread (Users: 0, Guests: 1)

Top