If the World Supply Curve Is S_W0

question 106

Multiple Choice

If the world supply curve is S_W0,

• A)there is a trade deficit.
• B)there is a trade surplus.
• C)trade is in balance.
• D)there is no trade.

---

Definitions:

Market Price

The existing value at which an asset or service might be acquired or disposed of on the open market.

Marginal Revenue

The incremental revenue procured by selling an extra unit of a product or service.

Marginal Cost

The cost of producing one additional unit of a product or service, crucial for pricing and production decisions.

Purely Competitive Firm

A business operating in a market where there are many buyers and sellers of a homogeneous product with no single entity able to influence the market price.