Refer to the figure below to answer the following questions.

Figure 7.2.2
The figure shows the market for helicopters in Canada, where D is the domestic demand curve and S is the domestic supply curve. Canada trades helicopters with the rest of the world at a price of $36 million per helicopter.
-In Figure 7.2.2, with international trade, ________ helicopters per year are produced in Canada.
A)360
B)480
C)720
D)240
E)600

Question

Refer to the figure below to answer the following questions.
  
Figure 7.2.2
The figure shows the market for helicopters in Canada, where D is the domestic demand curve and S is the domestic supply curve. Canada trades helicopters with the rest of the world at a price of $36 million per helicopter.
-In Figure 7.2.2, with international trade, ________ helicopters per year are produced in Canada.
A)360 
B)480 
C)720 
D)240 
E)600

Quizplus · Accepted Answer

With international trade, the price of a helicopter is $36 million per helicopter, which is higher than the equilibrium price in Canada of $30 million per helicopter. As a result, Canada will increase production by the amount of the difference between the quantity demanded at the international price and the quantity supplied at the international price, which is 720 helicopters per year (900 - 180).

Refer to the Figure Below to Answer the Following Questions