Who gains from an export tariff in a small country?
A) consumers because consumer surplus increases and exporters because they can increase their prices
B) exporters because they can increase their prices
C) the government because it collects tariff revenues and consumers because consumer surplus increases
D) exporters because they can increase their prices and the government because it collects tariff revenues

Question

Quizplus · Accepted Answer

The government benefits from collecting tariff revenues, and consumers may experience an increase in consumer surplus due to potentially lower domestic prices when domestic supply increases as a result of the tariff.

Who Gains from an Export Tariff in a Small Country