Figure 9-20
The figure illustrates the market for rice in Vietnam.
-Refer to Figure 9-20.With trade,Vietnam will

Question

Figure 9-20
The figure illustrates the market for rice in Vietnam. 
-Refer to Figure 9-20.With trade,Vietnam will

Quizplus · Accepted Answer

The world price of rice is higher than the domestic price in Vietnam. Therefore, Vietnam will export rice to take advantage of the higher price. The difference between the world price and domestic price is reflected in the vertical distance between the world price line and domestic supply curve. At the world price, Vietnam can produce and export 1,500 units of rice, which is the quantity at the intersection of the world price line and domestic supply curve. Therefore, choice B is the correct answer.

Figure 9-20 The Figure Illustrates the Market for Rice in Vietnam