Suppose a country,whose production and consumption of coffee is large relative to the world market,has just entered the global market.If the country is a net exporter of coffee,we would expect:

Question

Quizplus · Accepted Answer

The country's entry into the global market increases the world supply of coffee, shifting the supply curve to the right. As the country is a net exporter, it will supply more coffee to the world market, further increasing the supply. The demand curve will not shift significantly as the country's consumption is already large relative to the world market.

Suppose a Country,whose Production and Consumption of Coffee Is Large