Answer:
a. $86.40 per necklace
b. $86.40 per necklace
c. $83.20 per necklace
Explanation:
free market price pf necklace is $80.00
Initial tariff on import = 8%
8% of $80.000 = 0.08 x $80.00 = $6.40
Canadians will therefore pay $80.00 + $6.40 = $86.40 per necklace
If tariff is reduced to 4%,
4% of $80.00 = 0.04 x $80.00 = $3.20
new price per necklace = $80.00 + $3.20 = $83.20 per necklace