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The Following Two Graphs Depict the Equilibrium Price of a Pound

question 113

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The following two graphs depict the equilibrium price of a pound of grapes in California and West Virginia, respectively. Assume the type and quality of the grapes being sold in the two states are identical. Further, assume grape sellers incur zero costs to transport grapes between the two states and there are no other barriers to trade. Use these graphs to answer the following questions. The following two graphs depict the equilibrium price of a pound of grapes in California and West Virginia, respectively. Assume the type and quality of the grapes being sold in the two states are identical. Further, assume grape sellers incur zero costs to transport grapes between the two states and there are no other barriers to trade. Use these graphs to answer the following questions.   -Which of the following pairs of prices is consistent with the law of one price? A)  California price: $0.50; West Virginia price: $0.80 B)  California price: $0.80; West Virginia price: $0.80 C)  California price: $1.20; West Virginia price: $1.20 D)  California price: $1.35; West Virginia price: $1.35 E)  California price: $1.50; West Virginia price: $1.50
-Which of the following pairs of prices is consistent with the law of one price?

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Definitions:

Online Payments

Transactions that enable individuals to pay for products or services over the internet using digital financial instruments, such as credit cards, electronic wallets, or bank transfers.

Electronic Storefront

The website of a single company, with its own Internet address, at which orders can be placed.

Single Store

A retail business that operates from one physical location, offering products or services to customers from that sole position.

Electronic Marketplace

A virtual market space on the Web where many buyers and many sellers conduct electronic business activities.

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