Figure 51 Illustrates the Steel Market for Mexico, Assumed to Be

Multiple Choice

Figure 5.1 illustrates the steel market for Mexico, assumed to be a "small" country that is unable to affect the world price. Suppose the world price of steel is given and constant at $200 per ton. Now suppose the Mexican steel industry is able to obtain trade protection.
Figure 5.1. Alternative Nontariff Trade Barriers Levied by a "Small" Country
-Consider Figure 5.1.Suppose the Mexican government provides a subsidy of $200 per ton to its steel producers, as indicated by the supply schedule S_{M (with subsidy)} .The overall deadweight welfare loss to Mexico equals

A) $200.
B) $400.
C) $600.
D) $800.