a) answer question attached b) After opening up tradeConsumer surplus will: (increase, decrease, stay the same),Producer Surplus will: (increase, decrease, stay the same). Total Surplus will: (increase, decrease, stay the same). c) Did opening up to trade create deadweight loss (DWL)? (yes or no) Under trade,thousand kg of sugar will be supplied by Malaysianproducers.thousand kg of sugar will be demanded by Malaysian consumers.thousand kg of sugar will be(enter either "imported"or "exported"). Problem 2The sugar market in Malaysia is shown in the figure below.Assume Malaysia is a small producer/consumer of sugar relative to the world market.Price ($)1.11.00.90.80.70.60.50.4World Price0.30.2D0.10.0306090120150180210240270Quantity of sugar (thousands of kg)

Answered: answer question attached b) After…

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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a) answer question attached

b) After opening up trade

Consumer surplus will: (increase, decrease, stay the same),

Producer Surplus will: (increase, decrease, stay the same).

Total Surplus will: (increase, decrease, stay the same).

c) Did opening up to trade create deadweight loss (DWL)? (yes or no)

Under trade,
thousand kg of sugar will be supplied by Malaysian
producers.
thousand kg of sugar will be demanded by Malaysian consumers.
thousand kg of sugar will be
(enter either "imported"
or "exported").

Problem 2
The sugar market in Malaysia is shown in the figure below.
Assume Malaysia is a small producer/consumer of sugar relative to the world market.
Price ($)
1.1
1.0
0.9
0.8
0.7
0.6
0.5
0.4
World Price
0.3
0.2
D
0.1
0.0
30
60
90
120
150
180
210
240
270
Quantity of sugar (thousands of kg)

Expert Solution

Step 1

Consumer surplus is the difference between what the consumer pays and what he would have been willing to pay. Producers surplus is the difference between the price a firm receives and the price it would be willing to sell it at.

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