If there is free trade in a small economy, the nation will be able to import
Unlimited quantities of the product at:

Question

Quizplus · Accepted Answer

With free trade, the nation will be able to import products at the world price, which is the price that reflects supply and demand from all countries that produce and consume the product. Importing at the domestic price (A) would create a shortage in the domestic market, while importing at a price measured in euros (C) would be arbitrary and depend on exchange rates. Importing at a price determined after tariffs (D) would not be truly "free trade" as tariffs are a form of protectionism.

If There Is Free Trade in a Small Economy, the Nation