Show the effects of the $60 tariff on the following graph. Use the black line (p

Question

Show the effects of the $60 tariff on the following graph. Use the black line (plus symbol) to indicate the world price plus the tariff. Then, use the green triangle (triangle symbols) to show the consumer surplus with the tariff and the purple triangle (diamond symbols) to show the producer surplus with the tariff. Lastly, use the orange quadrilateral (square symbols) to shade the area representing government revenue received from the tariff and the tan triangles (dash symbols) to shade the areas representing the net loss or deadweight loss (DWL) caused by the tariff. Complete the following table to summarize your results from the previous two graphs.

Explanation / Answer

Answer to blank 1: 30 (i.e. 40 - 10)

Answer to blank 2: $310

Answer to blank 3: 30

Answer to blank 4: 30

Answer to blank 5: $310

Answer to blank 6: 10 (i.e. 30 - 20)

Answer to blank 7: decrease

Answer to blank 8: $1100 (i.e. 4800 - 2700)

Answer to blank 9: increase

Answer to blank 10: $900

Answer to blank 11: $600

Answer to blank 12: decrease

Answer to blank 13: $1200 (5100 - 3900)

UFT($) UAT($) CS 4800 [i.e. {(490 - 250)*40}] /2 2700 [i.e. {(490 - 310)*30}] /2 PS 300 [i.e. {(250 - 190)*10}] /2 1200 [i.e. {(310 - 190)*20}] /2 GR 0 600 (i.e. $60*10)

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