Exercise 1.5 Question Help Home Market World Market Foreign Market o Price, P Pr
ID: 1158176 • Letter: E
Question
Exercise 1.5 Question Help Home Market World Market Foreign Market o Price, P Price, P Price,P xs 18 14 12 12 MD Quantity. Q Quantity. a Quantity.Q The left- and right-hand figures given above show the Home and Foreign markets for barley. The center figure shows the world barley market, containing Home's import demand (MD) and Foreign's export supply (XS). In the absence of both transportation costs and artificial trade barriers, the world barley market achieves equilibrium with O A. the price at $12, trade volume at 2 million tons, and total world output at 8 milion tons B. the price at $12, trade volume at 2 million tons, and total world output at 10 million tons. OC. the price at $12, trade volume at 2 million tons, and total world output at 5 milion tons 0 D. the price at $16, trade volume at 2 million tons, and total world output at 4 milion tons.Explanation / Answer
The correct answer should be A. This shows the world output and the equilibrium output at $12 and total supply at 8 million tonnes. The correct answer is A.
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