Suppose the domestic price (no-international-trade price) of copper is $1.20 a pound in the United States while the world price is $1.00 a pound. Assuming no transportation costs, the United States
Will

Question

Quizplus · Accepted Answer

Since the world price of copper is lower than the domestic price, it is cheaper for the United States to import copper from other countries instead of producing it domestically. Therefore, the United States will import copper.

Suppose the Domestic Price (No-International-Trade Price) of Copper Is $1