Figure 9-10

-Refer to Figure 9-10.Consumer surplus in this market before trade is

Question

Figure 9-10
 
-Refer to Figure 9-10.Consumer surplus in this market before trade is

Quizplus · Accepted Answer

Consumer surplus is the difference between the price consumers are willing to pay for a good and the price they actually pay. In this market, before trade, the price consumers are willing to pay is given by the demand curve, and the price they actually pay is given by the world price. The difference between these two prices is represented by the area A.

Figure 9-10 -Refer to Figure 9-10.Consumer Surplus in This Market Before Trade