1.Country A is a large country in the market for Widgets. The following table summarizes two hypothetical situations in country A's domestic market for widgets. The first column depicts the situation with a $1000 tariff on imported widgets. The second column represents the situation with no tariff (that is, under free trade). Assume that transportation costs are zero and that demand and supply curves are linear.

With $1000 -- World price of a Widget $1,500 $2,000 Tariff per unit $1,000 Price of a Widget in Country A $2,500 $2,500 Widgets made in the US. per year 20,000 15,000 Widgets imported into the U.S. per year 20,000 30,000 Find out if there will be net welfare gain for the large country due to the imposition of the $0 Widgets bought in the US. per year 40,000 45,000