The figure below shows the demand (D)and supply (S)curves of corn syrups. Figure 35.3 In Figure 35.3, if the world price per gallon is $8, then without quotas:

Question

The figure below shows the demand (D)and supply (S)curves of corn syrups. Figure 35.3  In Figure 35.3, if the world price per gallon is $8, then without quotas:

Quizplus · Accepted Answer

Without quotas, the market will reach equilibrium where the quantity demanded equals the quantity supplied. In this case, at a price of $8, the quantity demanded is 45 gallons and the quantity supplied is 30 gallons. Therefore, there will be an excess demand of 15 gallons. This excess demand will be met by imports, which will be equal to the difference between the quantity demanded and the quantity supplied, i.e. 45-30=15 gallons. Therefore, choice C is the correct answer.

The Figure Below Shows the Demand (D)and Supply (S)curves of Corn