The US has imposed a tariff of 45% on soft wood imports from Canada. The tariff caused imports of lumber to drop to drop precipitously after only a few months. Additionally, the price of lumber rose significantly after only a few months.

Who benefited from this tariff?

a- US soft wood producers

b- non-Canadian foreign soft wood producers

c-US Soft wood consumers

d- Canadian soft wood producers

Now suppose that the US increase the tariff to 75% on soft wood imports from Canada. Which of the following will occur in the US?

a- the average soft wood price will increase

b-only lumber imported from non-canadian foreign producers will increase in price

c-only lumber produced in canada will increase in price

d-only domestically produced lumber will increase in price

e-the average soft wood price will remain the same