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Consider a Market in a Small Country with a Domestic

Question 1

Multiple Choice

Consider a market in a small country with a domestic demand curve of P = 28 - q and a domestic supply curve of P = 3q.The world price is $9 per unit.If the country opens itself up to international trade:


A) PS decreases by $35.
B) PS decreases by $55.
C) PS decreases by $70.
D) PS decreases by $75.
E) None of the above.

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