Figure 9-1

Figure 9-1 shows the U.S. demand and supply for leather footwear.
-Refer to Figure 9-1.Suppose the government allows imports of leather footwear into the United States.The market price falls to $18.What is the value of consumer surplus?

Question

Figure 9-1
  
Figure 9-1 shows the U.S. demand and supply for leather footwear.
-Refer to Figure 9-1.Suppose the government allows imports of leather footwear into the United States.The market price falls to $18.What is the value of consumer surplus?

Quizplus · Accepted Answer

When the market price falls to $18 due to imports, consumer surplus increases as consumers pay less than they were willing to. The value of consumer surplus is calculated based on the area between the demand curve and the price level, which is $320.

Figure 9-1 Figure 9-1 Shows the U.S. Demand and Supply for Leather