Question
Below is the domestic market for headphones. Qd= 100,000-400P Qs=-20,000+200P The equilibrium price in the market is $200. The equilibrium quantity is 20,000. The consumer
Below is the domestic market for headphones.
Qd= 100,000-400P
Qs=-20,000+200P
The equilibrium price in the market is $200. The equilibrium quantity is 20,000. The consumer surplus in the market is $250 and the producer surplus is $100. Assume the government opens the market to international trade. The world price is currently $150. Answer the following:
a) The quantity of headphones now produced domestically will be ....
b) The quantity of headphones now consumed domestically will be ...
c) The change in total surplus for the economy, relative to the situation before the International trade is allowed, will be $...
Can u please show the working as well for the answers, thank you.
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