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Consider a small country mat exports steel. Suppose the following graph depicts the domestic demand and supplyr for steel in this country. One of the
Consider a small country mat exports steel. Suppose the following graph depicts the domestic demand and supplyr for steel in this country. One of the two price line." represents the world price of steel. Use the following graph to help you answer the questions below. You will not be graded on any ahanges made to this graph. Sunni? 1413 Demand h an an Triangle a P 3 an 2 Petition E v E g 5|: 3 A P a w 9 \"a 9.! \fBecause this country exports steei, the world mice is represented by V . Suppose that a \"pro-trade\" government decides to subsidize the export of steel bv paving $10 for each ton sold abroad. with this export subsidy, the pn'ce paid by domestic consumers is per ton, and the price received by domesc producers is per ton. The quantity of steel consumed bv domesb'c consumers V , the quaotv of steel produced by domestic producers V , and the quantity of steel exported V . True or False: with the export subsidy, domestic producers will not sell anyr steel to domesc consumers. 0 True 0 False Under the export subsidy, consumer surplus is and producer surplus is . Government revenue V by . As a resuit, total surplus V
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