The UK government raises the price of steel brought in from Germany by increasing an existing tariff. If steel has price-inelastic demand, what effect would this have on the revenues of German steel producers and the UK government?
- AGerman steel producers’ revenue decrease; UK government revenue decrease
- BGerman steel producers’ revenue decrease; UK government revenue increase
- CGerman steel producers’ revenue increase; UK government revenue decrease
- DGerman steel producers’ revenue increase; UK government revenue increase