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5.1 5.2 [3.2 [3.1 Quantity of Texliles Having rejected a tariff on textiles {a tax on imports), the president of Isoland is now considering the
5.1 5.2 [3.2 [3.1 Quantity of Texliles Having rejected a tariff on textiles {a tax on imports), the president of Isoland is now considering the samesized tax on textile consumption (including both imported and domestically produced textiles}. Under a texle consumption tax, the quantity of textiles consumed in Esolend is v , and the quantity produoed in Isoland is v The following table shows the effect of an import tariff on the nation of Isoland. The following table shows the effect of an import tariff on the nation of Isoland. Complete the remaining columns of the following table by indicating the effect of the same-sized tax on textile consumption. Under Tariff Under Consumption Tax Before Tariff or Tax After Change After Chi Consumer A + B + C+D+E+F A+ B - (C +D +E +F) A+B+ C+D +E+F Surplus Producer Surplus G C+G +C C+GV C Government None E +E Revenue Total Surplus A+B+ C+D+E+FIG A+B+C+E+G (D + F) Compared to the consumption tax, the tariff raises the same amount of * revenue for the government and has deadweight loss associated with it.Suppose the nation of {seland is an importer of texles and is looking for a way to raise government revenue. 111e following graph shows the effect mi a tariff on textile imports. C?) Price of Textiles
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