The diagram below shows the demand and supply curves for refrigerators in Canada.
FIGURE 34- 1
-Refer to Figure 34- 1, and assume the world price is P0. The Canadian government now imposes an import quota of the amount Q2Q4. The result would be that the price in Canada would:
A) stay at P0 and consumption would stay at Q5.
B) rise to P1 and consumption would decrease to Q4.
C) rise to P2 and consumption would decrease to Q5.
D) stay at P0 and consumption would rise to Q3.
E) rise to P2 and consumption would decrease to Q4.
Correct Answer:
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