Consider a large country applying a tariff t to imports of a good, like that represented in Figure below:

How does the size of the terms-of-trade gain compare with the size of the deadweight loss whenthe tariff is very small andthe tariff is very large? Use graphs to illustrate your answer.

Percentage of 100% U.S. import Tariff begins Tariff ends value 90 80 Value of imports from Canada, Mexico, and all other nations 70 60 50 Value of imports from 40 all other Asian countries 30 20 10 Value of imports from China 0 Q1 2007-Q1 2008-Q1 2009-Q1 2009-Q3 2009-Q 2010-Q1 12-0 2012-Q3 2012-Q4 20