Refer to the information provided in Figure 20.3 below to answer the question(s) that follow. Figure 20.3
-Refer to Figure 20.3. The domestic price of shoes is $80. After trade the price of a pair of shoes is $60. This would cause the number of pairs of shoes produced domestically to
A) increase.
B) decrease.
C) remain the same.
D) fall to zero.

Question

Refer to the information provided in Figure 20.3 below to answer the question(s) that follow.  Figure 20.3
-Refer to Figure 20.3. The domestic price of shoes is $80. After trade the price of a pair of shoes is $60. This would cause the number of pairs of shoes produced domestically to
A) increase. 
B) decrease. 
C) remain the same. 
D) fall to zero.

Quizplus · Accepted Answer

When the domestic price of shoes decreases from $80 to $60 due to trade, it typically means that the domestic market is now exposed to international competition where shoes are available at a lower price. This makes it harder for domestic producers to compete, leading to a decrease in the number of shoes produced domestically.

Refer to the Information Provided in Figure 20