d.instructure.com/courses/17509/assignments/203514 ON-121-6776 Assignments HW Ch

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d.instructure.com/courses/17509/assignments/203514 ON-121-6776 Assignments HW Ch. 3 HW Ch. 3 Econ 121, Fall 2018, 6776 Homework: HW Ch. 3 Score: 0.33 of 1 pt & End of Chapter 4.9 360145 (36 comp the enormous imports of cheap bananas into the United States tend to curtail the domestic consumption of fresh fruits produced in the United States Source: Quoted in Douglas A. Irwin, Peddling Protectionism: Smoot-Hawley and the Great Depression, Princeton, NJ: Princeton University Press, 2011, p. 22 This producer apparently assumed apples and bananas to be substitutes In a graph (not shown) of the banana market in the United States, the imposition of a tariftf on banana imports would O A. not shift any curve but raise the equilibrium price because taxes are always O B. shift demand leftward, decreasing equilibrium price and equilibrium quantity O C. shift supply leftward, increasing equilibrium price and decreasing equilibrium D. shift supply leftward, decreasing equilbnum price and increasing equdbrum passed on to the consumer quantity quantity Click to select your answer and then click Check Answer emaining

Explanation / Answer

Correct Answer:

C

With imposition of the tariff, the supply of bananas in the market will decrease. It will cause the supply curve to shift in the left direction. As a result, price of banana will increase and quantity will decrease at the new equilibrium.

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