Trump’s Trade War Looms Over Soybean Farmers 4 Years Later

It’s been nearly four years since China put tariffs on American soybeans in a trade war with then-President Donald Trump. The Chinese tariffs hurt U.S. farmers by making American-grown soybeans more expensive for Chinese buyers.—cnn.com

Answer the following questions to check your understanding of the story.

1) Who in China loses from China’s tariff on U.S. soybeans?

The losers are ______________.

a) Chinese farmers because they must pay the tariff to the Chinese government

b) Chinese consumers because they buy more imported soybean, but pay a higher price

c) Chinese farmers because they receive a lower price and produce less soybean

d) Chinese consumers because they pay a higher price and buy less soybean

2) What is the effect of China imposing a tariff on U.S. soybeans on China’s consumer surplus, producer surplus, and deadweight loss?

a) Consumer surplus and producer surplus remain the same, but a deadweight loss arises.

b) Consumer surplus decreases, producer surplus increases, and the deadweight loss is eliminated.

c) Consumer surplus increases, producer surplus decreases, and a deadweight loss arises.

d) Consumer surplus decreases, producer surplus increases, and a deadweight loss arises.

Trump’s Trade War Looms Over Soybean Farmers 4 Years Later

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