The home import demand curve is downward sloping because:
A) as the government forces the price down, consumers buy more.
B) foreign companies want to help domestic competitors.
C) as the price falls below domestic equilibrium, the shortage in demand is filled by importing more quantity from abroad.
D) consumers can control the price of the good.

Question

Quizplus · Accepted Answer

The downward sloping home import demand curve is a result of consumers importing more of the good as the price falls below the domestic equilibrium. This is because a lower price makes it more affordable for consumers to purchase the good, and the shortage in domestic demand can be met by importing more quantity from abroad. Choices A, B, and D are incorrect as they do not accurately describe the reason for the downward sloping curve.

The Home Import Demand Curve Is Downward Sloping Because