The model represents the market for sugar in a small nation.Assume S 1 represents the U.S.domestic supply of sugar and S 2 represents the supply in the U.S.under conditions of free trade
-In Figure 17.2,in the absence of trade,the domestic price of sugar will be:

Question

The model represents the market for sugar in a small nation.Assume S 1 represents the U.S.domestic supply of sugar and S 2 represents the supply in the U.S.under conditions of free trade 
-In Figure 17.2,in the absence of trade,the domestic price of sugar will be:

Quizplus · Accepted Answer

In the absence of trade, the domestic market is represented by S₁. The equilibrium price in this market is P₁, which is the point at which the supply and demand curves intersect.

The Model Represents the Market for Sugar in a Small