Domestic Action Figure Market Price Supply 10 6B Demand 20 80 100 Figurines 1000

Question

Domestic Action Figure Market Price Supply 10 6B Demand 20 80 100 Figurines 1000s month 6. (5pts)Consider the above graph. The government decides to open the action figurine market to free trade. Before free trade, a. Producer Surplus is represented by area C b. Consumer Surplus is represented by area A + B+D+E c. Dead Weight Loss is represented by area D+E d. Total Surplus is represented by area A+B+C+D+E 7. (5pts)Consider the above graph. After free trade, a. Both Producers and consumers are better off b. Consumer are better off and producers are worse off. Both Producers and consumers are worse off. Consumer are worse off and producers are better off. d.

Explanation / Answer

6) Before free trade

a) Produce surplus is represented by the area B+C

b) Consumer Surplus is represented by the area A.

c) There is no DWL.

d) Total surplus is represented by the area A+B+C.

7. Ans: Consumers are better Off and producers are worse off.

Explanation:

After free trade, CS = area A+B+D+E, which is greater than before free trade CS = area A.

After free trade, PS = area C, which is less than before free trade PS = B+C.

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.