Suppose that the supply schedule of Maine lobsters is as follows:

Price of lobster

(per pound)

Quantity of lobster supplied (pounds)

$25 800 20 700 15 600 10 500 5 400 Suppose that Maine lobsters can be sold only in the United States. The U.S. demand schedule for Maine lobsters is as follows:
Price of lobster (per pound)
Quantity of lobster demanded (pounds)
$25 200 20 400 15 600 10 800 5 1,000

a. Draw the demand curve and the supply curve for Maine lobsters. What are the equilibrium price and quantity of lobsters?
Now suppose that Maine lobsters can be sold in France.
The French demand schedule for Maine lobsters is as follows:
Price of lobster (per pound)
Quantity of lobster supplied (pounds)
$25 100 20 300 15 500 10 700 5 900

b. What is the demand schedule for Maine lobsters now that French consumers can also buy them?
Draw a supply and demand diagram that illustrates the new equilibrium price and quantity of lobsters. What will happen to the price at which fishermen can sell lobster? What will happen to the price paid by U.S. consumers?
What will happen to the quantity consumed by U.S. consumers?