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pishuonlain [190]
3 years ago
15

Suppose that Australia imposes a tariff on imported beef. If the increase in producer surplus is $100 million, the increase in t

ariff revenue is $200 million, and the reduction in consumer surplus is $500 million, the deadweight loss of the tariff is $300 million.a) trueb) false
Business
1 answer:
hram777 [196]3 years ago
6 0

Answer: False

Explanation:

A tariff is a tax that is imposed by the government of a particular country in order to curtail the number of imported goods brought into the country.

Based on the above scenario, the reduction in consumer surplus is not $500 million but rather $600 million which is the addition of $100 million, $200 million and $300 million.

Therefore the question is false.

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a. 1, and total revenue and price move in the same direction

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Unit elasticity of demand is when a change in price leads to a proportional change in quantity demanded.

A good has a unit elastic demand when its coefficient of elasticity is equal to one.

If price increases by 20% , quantity demanded falls by 20%.

If price falls by 20%, quantity demanded increases by 20%.

I hope my answer helps you.

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