Based on the estimates of the U.S. daily oil demand function in Equation 9.3 and supply function in Equation 9.4, use calculus to determine the change in deadweight loss from a marginal increase in a tariff, evaluated where the tariff is initially zero. (You are being asked to determine how an area similar to that of C + E in Figure 9.8 changes when a small tariff is initially applied?
Equation 9.3,
Q = D(p) = 35.4p-0.37,
Equation 9.4,
Q = S(p) = 3.35p0.33.