Answer Happy

[Q: 9-3948795] The figure to the right shows the United States' domestic market for a particular good. Suppose that this market is currently operating under an open-trade policy where the domestic price is Pw S U.S. Dom est ic Market To help domestic producers, policy makers could impose a tariff to increase the domestic price from Pw to PTAR or they could reach that same domestic price by imposing an import quota that wouldn't allow more than QD - QFAR units to enter the country. Which of the following statements is false regarding these two policy options when comparing them to an open-trade policy? TAR PA B O A. Domestic consumer surplus would decrease by Area EFGHI O B. Domestic social surplus would be the same under either policy. OC. An import quota is inferior to a tariff because it does not have government revenue. OD. A tariff would create a deadweight loss equal to Area FI C D PTAR F G H F I Pw L N D K M 0 Qw QTAR QA Q QTAR Qw