Figure 9-11
-Refer to Figure 9-11.Producer surplus plus consumer surplus in this market before trade is
A)A + B.
B)A + B + C.
C)A + B + C + D.
D)B + C + D.

Question

Figure 9-11 
-Refer to Figure 9-11.Producer surplus plus consumer surplus in this market before trade is
A)A + B. 
B)A + B + C. 
C)A + B + C + D. 
D)B + C + D.

Quizplus · Accepted Answer

Producer surplus in this market is represented by area A, while consumer surplus is represented by areas A+B+C. Therefore, the sum of producer surplus and consumer surplus before trade is A+B+C, which is represented by choice B. Areas C and D represent the gains from trade (additional consumer and producer surplus), which are created after the market opens up to international trade.

Figure 9-11 -Refer to Figure 9-11.Producer Surplus Plus Consumer Surplus in This