Suppose that the world price of kiwi fruit ($10 per box) is below the domestic price ($12 per box). A tariff of $1 per box would:

a. cause foreign producers to be better off, because the price they charge is now higher by $1 per box.
b. cause domestic producers to be worse off by $5 per box.
c. allow domestic consumers to enjoy kiwi fruit for $5 more per box than the free trade price, but still $2 less than the domestic price.
d. allow domestic consumers to enjoy kiwi fruit for $1 more per box than the free trade price, but still $1 less than the domestic price.
e. cause domestic producers to be worse off by $10 per box.

d

Economics

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