Incase number in paragraph isn't clear it's 80$ per ton.

Homework (Ch 05) 3. Agricultural export subsidies in a small nation The following graph shows the market for wheat in Cinda, where Dic is the demand curve. So Is the supply curve, and Py is the free trade price of wheat. Amcume that Canada In a relatively small producer of wheat. in changes in its output do not affect the world price of wheat. Also assume that Canada Is currently open to free trade, and do ers are able to purchase wheat of the wald pike with ney able tra uppose a subsidy of $80 per ton bag them to sell the products sbread at prices below their costs. Am that trade restrictions are also put in place from buying wheat abroad at the world price. Use the prey line ( star symbols) to indicate on the fod ing graph. Then was the black point (plus symbol) to indicats the price of wheat in Canada and the our use the tan point (dash symbol) in indicate the price of wheat received by Canadian producers with the subsidy and the cu y of wheat they will supply at that price. Rashcards PRICE (Cozart pertary Loss B CS QUANTITY (Tomas) Export subhidden result in a wellare loss to the home country don to the protective and c effects. In order to determine the magnitur these effects, you must compare the change in co cer's surplus against the cost of the subsidy. On the previous graphy Lise the green cite the loss in a mer surpis due to the sport subsay. Then use the purple quadrilateral (dumond mym rodger surplus an a result of the export subsidy The taxpayer cent of the export subsidy equals using all of the previous information, compute the value of dadamy mout of the export subsidy Deadweight Loss - Loss in Coorsmer Surplus + Cost of Subsidy -Gain in Producer Surplus