Figure 9-11
-Refer to Figure 9-11.The change in total surplus in this market because of trade is
A)A,and this area represents a loss of total surplus.
B)B,and this area represents a gain in total surplus.
C)C,and this area represents a loss of total surplus.
D)D,and this area represents a gain in total surplus.

Question

Figure 9-11 
-Refer to Figure 9-11.The change in total surplus in this market because of trade is
A)A,and this area represents a loss of total surplus. 
B)B,and this area represents a gain in total surplus. 
C)C,and this area represents a loss of total surplus. 
D)D,and this area represents a gain in total surplus.

Quizplus · Accepted Answer

The change in total surplus in this market because of trade is represented by area D, which is a gain in total surplus. This is because trade allows consumers to access lower-priced imported goods, resulting in a consumer surplus gain (area A + D), and producers to expand their market and increase output, resulting in a producer surplus gain (area B + D). Together, these gains outweigh the small deadweight loss (area C) caused by trade.

Figure 9-11 -Refer to Figure 9-11.The Change in Total Surplus in This