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,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

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,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

Glazeland will produce 3 million doughnuts and import 3 million because the world price is lower than the domestic equilibrium price, leading to increased imports to meet domestic demand.

Table 7.1.1 Glazeland's Doughnut Market