Use the following scenario to answer the next four questions:
RayRay and Andrew produce baseballs and golf balls. RayRay can produce six baseballs per hour or four golf balls per hour. Andrew can produce three baseballs per hour or one golf ball per hour.
-Assume there is a 35% tariff on bananas imported into the United States.Also,assume that the market competition is at its beginning and the law of one price is not in effect.If the domestic market price of Hawaiian bananas is one dollar per bunch,imported bananas will sell for:

Question

Quizplus · Accepted Answer

With a 35% tariff, the price of imported bananas would increase by 35 cents (35% of $1.00) per bunch. Therefore, the price of imported bananas would be $1.35 per bunch.

Use the Following Scenario to Answer the Next Four Questions