If There Are No Barriers to Trade,the Current Domestic Price

question 57

Multiple Choice

If there are no barriers to trade,the current domestic price of coffee in Brazil is 8 reals per pound,the U.S.price is $4.50 per pound,and the exchange rate is 3.2 reals to the dollar

• A) Brazil is not exporting coffee to the United States.
• B) the United States does not want to import as much coffee from Brazil as Brazil wants to import from the United States.
• C) there is a bilateral equilibrium in the U.S.-Brazilian coffee trade.
• D) the U.S. price of coffee falls below $4.50 per pound and the Brazilian price rises above 8 reals per pound.
• E) the United States is exporting coffee to Brazil.

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Leisure

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