Refer to the table below to answer the following questions.
Table 7.1.1
Glazeland's Doughnut Market

-Table 7.1.1 shows Glazeland's doughnut market before international trade.Glazeland opens up to international trade.If the world price is $0.40 a doughnut then Glazeland will produce ________ doughnuts and will ________ doughnuts.
A)3 million;import 3 million
B)3 million;export 3 million
C)4 million;import 1 million
D)4 million;export 1 million
E)6 million;export 3 million

Question

Refer to the table below to answer the following questions.
Table 7.1.1
Glazeland's Doughnut Market
 
-Table 7.1.1 shows Glazeland's doughnut market before international trade.Glazeland opens up to international trade.If the world price is $0.40 a doughnut then Glazeland will produce ________ doughnuts and will ________ doughnuts.
A)3 million;import 3 million 
B)3 million;export 3 million 
C)4 million;import 1 million 
D)4 million;export 1 million 
E)6 million;export 3 million

Quizplus · Accepted Answer

Without seeing Table 7.1.1, we can deduce that if Glazeland will import doughnuts, the world price must be lower than Glazeland's domestic equilibrium price, leading to domestic production decreasing and imports filling the gap to meet demand.

Refer to the Table Below to Answer the Following Questions