A Supply and Demand Diagram for Rubber has just seen its Largest Producer in Portugal face a Devastating Tsunami 1. As a Result, Supply cuts back. What happens to Producer and Consumer Surplus?

1. Call the Price Equilibrium Point X. Call the New Price Equilibrium [Supply Shifts to the Left] Point Y. The Consumer Surplus will Change from the Highest Price Point, The Price Equilibrium, and Point X, to again the Highest Price Point, The New Price Equilibrium and Point Y. The Producer Surplus will Change from the Lowest Price Point, The Equilibrium Price and Point X to again Lowest Price Point, New Price Equilibrium and Point Y.