Essay
The following figure shows the demand curve, D, and the supply curve, S, for soap in Barylia.
a) What is the consumer surplus, producer surplus, and total surplus in Barylia if the nation does not participate in free trade?
b) If the world price of soap is $2 per unit, will Barylia import or export soap?
c) What is the change in consumer surplus, producer surplus, and total surplus if Barylia participates in free trade?
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a) The domestic price of soap is determi...View Answer
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