Question

refer to figure 34-5. assume that the current price of sugar in the united states is \\$300 per ton (which includes a \\$100 per ton tariff on sugar imports). americans purchase ____ million tons of sugar from u.s. producers and import ____ million tons of sugar from abroad.

10; 5
10; 15
15; 10
15; 20

Explanation:

Identify the domestic supply and demand at the tariff price

At the current price of \$300 per ton (which includes the tariff):

• The domestic quantity supplied by U.S. producers is found on the supply curve \(S_{\text{US}}\) at a price of \$300:

$$ Q_S = 10 \text{ million tons} $$

• The domestic quantity demanded by U.S. consumers is found on the demand curve \(D_{\text{US}}\) at a price of \$300:

$$ Q_D = 15 \text{ million tons} $$

Calculate the quantity of imports

The difference between domestic quantity demanded and domestic quantity supplied is met by imports:

$$ \text{Imports} = Q_D - Q_S = 15 - 10 = 5 \text{ million tons} $$

Match with the given options

• Americans purchase 10 million tons of sugar from U.S. producers.
• Americans import 5 million tons of sugar from abroad.
• This corresponds to the option "10; 5".

Answer:

• (A) 10; 5 (Correct answer)
• (B) 10; 15
• (C) 15; 10
• (D) 15; 20