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List of Figures
Figure 1
Individual Demand
Price
Aggregate Demand
Price
mu’’
p*
p*
mu’
c’ c* c’’
c*
Quantity
Quantity
Figure 2
Firm Supply
Price
Aggregate Supply
Price
mc’’
p*
p*
mc’
q’ q* q’’
q*
Quantity
1
Quantity
Figure 3
Market Equilibrium
Price
Consumers
surplus
Supply curve
p*
Demand curve
Producers
surplus
c*
Quantity
Figure 4
Home Market
Price
Import Demand
Supply
curve
p*
Price
p*
p’’
p’’
A
B
C
D
C
p’
E
p’
Demand
curve
z’ z’’
c* c’’
c’
Quantity
2
MD
M’’
M’
Imports
Figure 5
Foreign Market
Price
Export Supply
Price
Supply
curve
XS
p’’
p’’
A
B C
D
E
D
p’
p’
p*
p*
F
Demand
curve
c’’ c’
c* z’ z’’
Quantity
Figure 6
Open-Economy Market
Price
XS ≡ MS
pFT
MD
MFT = XFT
Imports
3
X’
X’’
Exports
Figure 7
Foreign Market
Export Supply
Border
Price
Price
Demand
Open-Economy Market
Domestic
Price
Supply
MS’
MS
D2
Domestic
Price
Domestic
Price
C1
C
D= D1+D2
p’
A
A
pFT
B
E
B
p’-T
C2
C=C1+C2
p’
pFT
Home Market
XS ≡ MS
ps
D1
Import Demand
pFT
B
A
pFT
B
B
p’-T
E
pFT
p’-T
B
p’-T
p’-T
T
D
X’
Quantity
X’
XFT
M’
Exports
4
MFT = XFT
Supply
MD
Imports
M’
MFT
Imports
Demand
M’
Quantity
Figure 8
Open-Economy Market
Home Market
Price
Price
C2
C
pFT+T
C1
MS’
A
pFT
MS
pFT+T
E
A
pFT
Supply
Demand
MD
M’
MFT
Imports
M’
5
Quantity
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