1. In the market for coffee, quantity demanded is given by Q = 10 - P,...

1. In the market for coffee, quantity demanded is given by Q = 10 - P, and quantity supplied is given by Q = P, where Q represents tonnes of coffee per year.
The government has decided to open the economy for international trade and the world price is $3. Following this action, total surplus will ____ by ____. Producer surplus will ____ by ____. Consumer surplus will ____ by ____.

2. In the market for tea, quantity demanded is given by Q = 5 - P/2, and quantity supplied is given by Q = P/2, where Q respresents tonnes of tea per year. The government has decided to open the economy for international trade and the world price is $2. This country will ____, ____ tonnes of tea per year and ____ surplus will ____.

Expert Solution

Rahul Sunny answered 1 year ago

1. In the market for tea, quantity demanded is given Q = 5 – P/2 and...

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