When Australia exports a good, Australian consumer surplus _______ and Australian total surplus _______ .

Question

Quizplus · Accepted Answer

When Australia exports a good, Australian consumer surplus decreases because domestic consumers now face higher prices due to some of the goods being sold abroad. However, Australian total surplus increases because the gains from trade (including producer surplus from higher prices and gains from exporting) outweigh the loss in consumer surplus.

When Australia Exports a Good, Australian Consumer Surplus _______ and Australian