US import demand for French perfumes is given by P = 90 - 3Q, where P is the perfume price ($), Q is the number of imported perfume bottles (in millions) demanded by US consumers. International supply of French perfumes (in dollars and in million bottles) is given by: P = 10 + 2Q. If the US government imposes a $10 import tariff on French perfumes entering the US market, what would be the deadweight loss for the world as a whole in the perfume market? Assume that these are the only two countries in the world.
Draw a graph to explain.
Hint: Draw supply and demand curves. From the producers' point of view, tariff appears as a cost that must be paid to the government. This means that the supply curve of perfumes will shift up by $10.