The village of Hum in Croatia has a market for shoes which buyers and sellers get together to determine the price of shoes. The regional price for shoes is above the village price and shoes are a tradable.  Using simple diagrams and proper labels show this situation, and the resulting consumer and producer surplus.

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A:

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A: a.

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Q: Considering the price support and the quota, calculate ) the consumer surplus, Answer: (i1) the…

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A: Answer in Step 2

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