Suppose the accompanying graph depicts the hypothetical market for sugar in Costa Rica. Suppose the country opens trade with the world sugar market and becomes a sugar exporter. a. In the accompanying graph, adjust the price line to depict how this impacts the market for sugar. Then, shade the area of consumer surplus using the CS area and shade the area of producer surplus using the PS area. b. After trade opens, what price will Costa Ricans pay for a pound of sugar? $ c. How much sugar will Costa Rica export after trade is opened? lbs. Price per Pound ($) 30 27 24 21 18 15 12 9 6 3 0 0 Market for Sugar in Costa Rica 20 40 60 80 100 120 140 160 Quantity of Sugar (lbs.) Supply Price Demand 180 200

Suppose the accompanying graph depicts the hypothetical market for sugar in Costa Rica. Suppose the country opens trade with the world sugar market and becomes a sugar exporter. a. In the accompanying graph, adjust the price line to depict how this impacts the market for sugar. Then, shade the area of consumer surplus using the CS area and shade the area of producer surplus using the PS area. b. After trade opens, what price will Costa Ricans pay for a pound of sugar? $ c. How much sugar will Costa Rica export after trade is opened? lbs. Price per Pound ($) 30 27 24 21 18 15 12 9 6 3 0 0 Market for Sugar in Costa Rica 20 40 60 80 100 120 140 160 Quantity of Sugar (lbs.) Supply Price Demand 180 200

Exploring Economics

8th Edition

ISBN:9781544336329

Author:Robert L. Sexton

Publisher:Robert L. Sexton

Chapter7: Market Efficiency And Welfare

Section: Chapter Questions

Problem 11P

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