Economics (AS & A Level) · Oct / Nov 2021 · Paper 13 · Question 26

The diagram shows the effects of the imposition of a tariff on an internationally-traded good. S_dom is the supply and D the demand in country R. S_w is the world supply curve of the product and S_wt is the world supply curve after the imposition of a tariff by country R. Which combination describes the effect on domestic supply of and demand for the good in country R after the imposition of the tariff?

1. Ademand falls, domestic supply falls
2. Bdemand falls, domestic supply rises
3. Cdemand rises, domestic supply falls
4. Ddemand rises, domestic supply rises

As printed in the paper