The following figure shows the demand curve, D, and supply curve, S, of ballpoint pens in Lithasia. The world price of pens is $2.

-Refer to the figure above.What is the consumer surplus after Lithasia opens up to free trade?

Question

The following figure shows the demand curve, D, and supply curve, S, of ballpoint pens in Lithasia. The world price of pens is $2.
 
-Refer to the figure above.What is the consumer surplus after Lithasia opens up to free trade?

Quizplus · Accepted Answer

Consumer surplus increases to $32 when Lithasia opens up to free trade, as consumers can purchase goods at a lower world price, increasing the area under the demand curve above the price line.

The Following Figure Shows the Demand Curve, D, and Supply