Question 2: Tariffs Currently, the United States (US) and Canada engage in free trade in the wine industry. The US are net-importers of Canadian wine. Due to recent disagreements the US is considering using a tariff to limit Canadian imports of wine to assist their local producers. The US constitutes the largest market for wine in the world. Canada is a small wine producers. (a) Using graphs, model the demand for wine in the US market and the import market under the scenario where there is free trade. (b) Using graphs, model the demand for wine in the US market and the import market under the scenario where there the US imposes a tariff on wine imports. (c) Does the tariff produce a net welfare gain for the US? Using a graph show the welfare changes (e.g. consumer and producer surplus) that occur in the US after the tariffs are introduced. (d) Which types of goods, with respect to product differentiation, are most susceptible to having much lower demand following the introduction of tariffs