The following graph shows the market equilibrium for corn in the United States.If the world price of corn is $6 and there are no trade restrictions,the United States will:

Question

Quizplus · Accepted Answer

At a world price of $6 and with no trade restrictions, the United States can produce corn at a lower opportunity cost than other countries, meaning they have a comparative advantage in corn production. This will lead to an increase in exports of 4,000 bushels, as shown by the graph where the quantity supplied at the equilibrium price exceeds the quantity demanded. Therefore, the United States will produce 7,000 bushels, consume 3,000 bushels, and export 4,000 bushels.

The Following Graph Shows the Market Equilibrium for Corn in the United