For a small country called Boxland, the equation of the domestic demand curve for cardboard is QD=350-2P, where QD 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 QS = -60+ 3P, where Q5 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 $51. Then Boxland's gains from international trade in cardboard amount to A) $1,201.25. B) $4,805.00. $2,402.50. $9,486.00.
For a small country called Boxland, the equation of the domestic demand curve for cardboard is QD=350-2P, where QD 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 QS = -60+ 3P, where Q5 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 $51. Then Boxland's gains from international trade in cardboard amount to A) $1,201.25. B) $4,805.00. $2,402.50. $9,486.00.
Chapter1: Making Economics Decisions
Section: Chapter Questions
Problem 1QTC
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![For a small country called Boxland, the equation of the domestic demand curve for cardboard is
QD350-2P, where QD 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 QS = -60+ 3P, where Q5 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 $51. Then Boxland's
gains from international trade in cardboard amount to
A) $1,201.25.
B) $4,805.00.
C) $2,402.50.
D) $9,486.00.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fb8bd5b56-a3d9-42ac-a00c-dbdcc0a94bc3%2F7c549c46-bc9e-426a-b403-eb251e4fa4b6%2F3vgplf_processed.jpeg&w=3840&q=75)
Transcribed Image Text:For a small country called Boxland, the equation of the domestic demand curve for cardboard is
QD350-2P, where QD 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 QS = -60+ 3P, where Q5 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 $51. Then Boxland's
gains from international trade in cardboard amount to
A) $1,201.25.
B) $4,805.00.
C) $2,402.50.
D) $9,486.00.
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Step 1: Determine the given information:
VIEWStep 2: Determine the domestic equilibrium price and quantity:
VIEWStep 3: Determine the total surplus before international trade:
VIEWStep 4: Determine the quantity supplied and quantity demanded at world price:
VIEWStep 5: Determine the total surplus under free trade:
VIEWStep 6: Determine the grain from international trade:
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