Refer to the information provided in Figure 4.5 below to answer the question(s) that follow. Figure 4.5
-Refer to Figure 4.5. If the United States eliminates all tariffs on CD-Rom drives, which of the following would occur?
A) The price of CD-Rom drives in the United States would be $15 per CD-Rom drive, and the United States would import 3 million CD-Rom drives.
B) The price of CD-Rom drives in the United States would be $25 per CD-Rom drive, and the United States would import 3 million CD-Rom drives.
C) The price of CD-Rom drives in the United States would be $15 per CD-Rom drive, and the United States would import 9 million CD-Rom drives.
D) The price of CD-Rom drives in the United States after the U.S. government eliminated all tariffs on imported CD-Rom drives cannot be determined from this information.

Question

Refer to the information provided in Figure 4.5 below to answer the question(s) that follow.  Figure 4.5
-Refer to Figure 4.5. If the United States eliminates all tariffs on CD-Rom drives, which of the following would occur?
A) The price of CD-Rom drives in the United States would be $15 per CD-Rom drive, and the United States would import 3 million CD-Rom drives. 
B) The price of CD-Rom drives in the United States would be $25 per CD-Rom drive, and the United States would import 3 million CD-Rom drives. 
C) The price of CD-Rom drives in the United States would be $15 per CD-Rom drive, and the United States would import 9 million CD-Rom drives. 
D) The price of CD-Rom drives in the United States after the U.S. government eliminated all tariffs on imported CD-Rom drives cannot be determined from this information.

Quizplus · Accepted Answer

Eliminating tariffs would lower the price to the world price of $15, leading to increased imports to meet demand.

Refer to the Information Provided in Figure 4