Figure 9-6

-Refer to Figure 9-6.With trade and without a tariff,
A) the domestic price is equal to the world price.
B) carnations are sold at $8 in this market.
C) there is a shortage of 400 carnations in this market.
D) this country imports 200 carnations.

Question

Figure 9-6
 
-Refer to Figure 9-6.With trade and without a tariff,
A) the domestic price is equal to the world price. 
B) carnations are sold at $8 in this market. 
C) there is a shortage of 400 carnations in this market. 
D) this country imports 200 carnations.

Quizplus · Accepted Answer

The graph shows that the world price and domestic price are the same without a tariff. Therefore, there is no effect on the quantity demanded or supplied, and neither imports nor exports occur. There is no shortage or surplus.

Figure 9-6 -Refer to Figure 9-6.With Trade and Without a Tariff