Economics 9708 · AS & A Level · Protectionism

Protectionism — practice question

In the diagram, Sd represents the domestic supply of a product, Sw represents the world supply and Dd represents the domestic demand for the product. Once the country has been operating under a free trade system, it then prohibits all imports. What effect will this ban have on the revenue of domestic producers and world producers?

  • Adomestic producers gain $120; world producers lose $50
  • Bdomestic producers gain $120; world producers lose $90
  • Cdomestic producers gain $160; world producers lose $50
  • Ddomestic producers gain $160; world producers lose $90

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