If the World Price of a Good Is Lower Than

question 150

True/False

If the world price of a good is lower than the no-trade equilibrium price for a particular country, the country will export the good.

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Definitions:

Rationing Coupons

Tickets or certificates that allow the holder to purchase a certain amount of a product or service, used especially in times of shortages to ensure equitable distribution.

Misallocation

The inefficient distribution or use of resources in an economy, often resulting from market failures or government intervention.

Resources

Assets, materials, and inputs needed for the production of goods and services, including time, labor, capital, and natural resources.

Excess Demand

A market condition where the quantity demanded of a good exceeds the quantity supplied, leading to shortages.