Refer to the Diagram, Which Pertains to Two Nations and a Specific

question 37

Multiple Choice

Refer to the diagram, which pertains to two nations and a specific product. The equilibrium level of exports and imports occurs at

• A)H, where GB and FC intersect.
• B)J, where the vertical distance between A and B equals the vertical distance between C and D.
• C)world price level F.
• D)world price level G.

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Definitions:

AVC

Average Variable Cost, which is the total variable costs of production divided by the quantity of output.

Short Run

A period in which at least one of a firm's inputs is fixed and cannot be varied.

Variable Costs

Expenses that directly fluctuate in accordance with the amount of production or output.

Average Cost

The total cost of production divided by the number of units produced, indicating the cost per unit.