Select one a bd b ac c c d cd Small Importing Country Net Na

Select one:

a. (b+d)

b. (a+c)

c. c

d. (c+d)

Small Importing Country: Net National Loss from a Tariff A. The U.S. Market for Bicycles B. The Market for U.S. Bicycle Imports Price ($ per bike) Price $per bike) 330 300 Tariff Demand curve for imports i d 1.4 1.6 (millions of bikes per year) 0.6 0.8 ?,-0.6 Quantity 0 Quantity imported (millions of bikes per year) M1 0.6 AM-0.4 Mo= 1.0

Solution

Correct option is (a).

In the right panel, shaded area \"e\" represents the deadweight loss resulting from tariff. In the left panel, sum of triangles \"b\" and \"d\" represents total deadweight loss from tariff. Therefore, Area e = Area (b + d).