Name: _________________________ Economics

4.2
Restrictions on free trade: trade protection - tariff
1. Match each description with the appropriate area or line segment on the diagram.

1. Quantity of imports under free trade

2. Tariff revenues
3. Quantity of imports following tariff
4. Decrease in consumer surplus as a result of the tariff
5. Export revenues collected by foreign producers after tariff is imposed
6. Increase in producer surplus as the result of the tariff
7. Supply of the good under free trade
8. Welfare loss as a result of the tariff
9. Production inefficiency as a result of the tariff
10. Supply of the good after the tariff is imposed
11. Consumption inefficiency as a result of the tariff
12. Value of imports under free trade (and export revenue foreign producers collect under free
trade)
13. Size of the tariff imposed
14. Consumer spending on imports of the good after the tariff is imposed
Name: _________________________ Economics

a. Area (1 + 2 + 3 + 4)
b. Area (A + B + C)
c. Line segment fhSw
d. Area (2) and area (4)
e. Line segment (Q1Q2)
f. Line segment (PwP’)
g. Area (B) and area (3)
h. Area (B)
i. Area (2)
j. Line segment (Q3Q4)
k. Area (3)
l. Line segment (fjS’)
m. Area (1)
n. Area (4)
Name: _________________________ Economics

2. Determine whether the following statement is true or false. Explain your answer. Use a
diagram to illustrate if possible.
“Social surplus increases with free trade but not all parties are better off”

3. Assume that the EU decides to protect its frozen strawberries market from cheaper
Chinese frozen strawberries by imposing a tariff. What would you consider if you were
to evaluate such a decision?