The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The United States trades freely with the rest of the world. The world price of a T-shirt is $5.
-Based on the figure above,as a result of international trade,consumer surplus
A) increases by $150 million.
B) decreases by $150 million.
C) increases by $90 million.
D) decreases by $90 million.
E) remains unchanged.

Question

The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The United States trades freely with the rest of the world. The world price of a T-shirt is $5.
-Based on the figure above,as a result of international trade,consumer surplus
A) increases by $150 million. 
B) decreases by $150 million. 
C) increases by $90 million. 
D) decreases by $90 million. 
E) remains unchanged.

Quizplus · Accepted Answer

International trade typically increases consumer surplus because consumers have access to a greater variety of goods at lower prices, leading to an increase in consumer surplus by $150 million in this scenario.

The Figure Above Shows the U