Figure 17-8
-Refer to Figure 17-8. The horizontal line at the world price of wagons represents the
A) demand for wagons from the rest of the world.
B) supply of wagons from the rest of the world.
C) level of inefficiency in the domestic market caused by trade.
D) surplus in the domestic wagon market.

Question

Figure 17-8 
-Refer to Figure 17-8. The horizontal line at the world price of wagons represents the
A) demand for wagons from the rest of the world. 
B) supply of wagons from the rest of the world. 
C) level of inefficiency in the domestic market caused by trade. 
D) surplus in the domestic wagon market.

Quizplus · Accepted Answer

The horizontal line at the world price represents the supply of wagons from the rest of the world, as it indicates the price at which the world market is willing to supply wagons, regardless of the quantity demanded.

Figure 17-8 -Refer to Figure 17-8. the Horizontal Line at the World