Scenario 9-1 ​

Multiple Choice

Scenario 9-1
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For a small country called Boxland, the equation of the domestic demand curve for cardboard is Q^D = 210 − 2P, where Q^D represents the domestic quantity of cardboard demanded, in tons, and P represents the price of a ton of cardboard. For Boxland, the equation of the domestic supply curve for cardboard is Q^S = -90 + 3P, where Q^S represents the domestic quantity of cardboard supplied, in tons, and P again represents the price of a ton of cardboard.
-Refer to Scenario 9-1. Suppose the world price of cardboard is $82.5. Then, relative to the no-trade situation, international trade in cardboard produces which of the following results for Boxland?

A) It decreases consumer surplus, increases producer surplus, and increases total surplus.
B) It decreases consumer surplus, increases producer surplus, and decreases total surplus.
C) It increases consumer surplus, decreases producer surplus, and decreases total surplus.
D) It increases consumer surplus, decreases producer surplus, and increases total surplus.