Export Subsidy, Small Country, Exportable Product
(Figure 10.4)

The export subsidy creates a wedge of $20 between the price that foreign importers pay and the revenue per unit that exporters receive. Press the "Show Subsidy" button to show the subsidy on the graphs. Notice that the wedge fits vertically at a quantity of 110 million pipes in panel B. The new world price is $88, the price paid by importers. Press the "Show New World Price" button to display the world price. The revenue per unit to the exporting firms, and the new price in the exporting country, is $108. Press the "Show Revenue Per Unit" button.
Press "Continue" when you are ready to move on. The "Reset" button will clear the graph.