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Scenario 9-1 The Before-Trade Domestic Price of Tomatoes in the United States

Question 126

Multiple Choice

Scenario 9-1
The before-trade domestic price of tomatoes in the United States is $500 per ton.The world price of tomatoes is $600 per ton.The U.S.is a price-taker in the market for tomatoes.
-Refer to Scenario 9-1.If trade in tomatoes is allowed,the


A) price paid by American consumers of tomatoes is unchanged relative to the no-trade situation.
B) total well-being of American producers of tomatoes is diminished relative to the no-trade situation.
C) total well-being of American consumers of tomatoes is enhanced relative to the no-trade situation.
D) total well-being of the United States is enhanced relative to the no-trade situation.

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