Answer the question(s)below based upon the following diagram which depicts country A's market for its importable.

-Refer to the figure above.In free trade A will import

Question

Answer the question(s)below based upon the following diagram which depicts country A's market for its importable.
 
-Refer to the figure above.In free trade A will import

Quizplus · Accepted Answer

In free trade, country A will import 600 units from country C, which is the quantity at which the domestic price intersects with the world price. There is no mention in the diagram of importing from country B, so option B and D are incorrect. Option A is also incorrect because importing 700 units from country C would lead to a domestic quantity supplied higher than the domestic quantity demanded, resulting in a surplus.

Answer the Question(s)below Based Upon the Following Diagram Which Depicts