Competitive firms in Africa sell their output only in Europe and the United States (which do not produce the good themselves). The industry’s supply curve is upward sloping. Europe puts a tariff of t per unit on the good, but the United States does not.

What is the effect of the tariff on the total quantity of the good sold, the quantity sold in Europe, the quantity sold in the United States, and equilibrium price(s)?

2. Trading Between Two People