Consider the Bolivian market for lemons. The following graph shows the domestic demand and domestic supply curves for lemons in Bolivia. Suppose Bolivia's government currently does not allow international trade in lemons. Use the black point (plus symbol) to indicate the equilibrium price of a ton of lemons and the equilibrium quantity of lemons in Bolivia in the absence of international trade. Then, use the green triangle (triangle symbol) to shade the area representing consumer surplus in equilibrium. Finally, use the purple triangle (diamond symbol) to shade the area representing producer surplus in equilibrium. 1100 Domestic Demand 1000 PRICE (Dollars per ton) - 900 800 700 600 500 400 300 200 100 0 35 70 Domestic Supply 105 140 175 210 245 QUANTITY (Tons of lemons) 280 315 350 Equilibrium without Trade Consumer Surplus Producer Surplus (?)

Consider the Bolivian market for lemons. The following graph shows the domestic demand and domestic supply curves for lemons in Bolivia. Suppose Bolivia's government currently does not allow international trade in lemons. Use the black point (plus symbol) to indicate the equilibrium price of a ton of lemons and the equilibrium quantity of lemons in Bolivia in the absence of international trade. Then, use the green triangle (triangle symbol) to shade the area representing consumer surplus in equilibrium. Finally, use the purple triangle (diamond symbol) to shade the area representing producer surplus in equilibrium. 1100 Domestic Demand 1000 PRICE (Dollars per ton) - 900 800 700 600 500 400 300 200 100 0 35 70 Domestic Supply 105 140 175 210 245 QUANTITY (Tons of lemons) 280 315 350 Equilibrium without Trade Consumer Surplus Producer Surplus (?)

ENGR.ECONOMIC ANALYSIS

14th Edition

ISBN:9780190931919

Author:NEWNAN

Publisher:NEWNAN

Chapter1: Making Economics Decisions

Section: Chapter Questions

Problem 1QTC

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