The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The United States trades freely with the rest of the world. The world price of a T-shirt is $5.
-Based on the figure above,as a result of international trade,U.S.domestic production ________ million T-shirts per year.
A) decreases by 20
B) increases by 20
C) decreases by 10
D) increases by 40
E) increases by 10

Question

The figure above shows the U.S. market for T-shirts, where SUS is the domestic supply curve and DUS is the domestic demand curve. The United States trades freely with the rest of the world. The world price of a T-shirt is $5.
-Based on the figure above,as a result of international trade,U.S.domestic production ________ million T-shirts per year.
A) decreases by 20 
B) increases by 20 
C) decreases by 10 
D) increases by 40 
E) increases by 10

Quizplus · Accepted Answer

International trade typically leads to a decrease in domestic production if the country imports more goods, as domestic producers face competition from foreign producers. The figure likely shows a decrease in U.S. domestic production by 20 million T-shirts per year due to increased imports.

The Figure Above Shows the U