The Following Figure Shows the Demand Curve, D, and the Supply

question 161

Multiple Choice

The following figure shows the demand curve, D, and the supply curve, S, for calculators in Barylia. The world price of calculators is $40.

-Refer to the figure above.Which of the following best describes a method to compensate the group that was made worse off when Barylia opened to free trade?

• A) The buyers could be taxed and the tax revenue used to compensate the sellers.
• B) The sellers could be taxed and the tax revenue used to compensate the buyers.
• C) Barylia could sell the calculators at a price below the domestic equilibrium price in the global market.
• D) Barylia could sell the calculators at a price above the world price in the global market.

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Definitions:

Misrepresented Warranty

A false or misleading statement about the condition or functionality of a product that can lead to a breach of warranty claim.

Respondeat Superior

A legal doctrine that holds an employer liable for the actions of an employee when the actions occur within the scope of employment.

Employer's Liability

The legal responsibility of employers to compensate employees for injuries or damages incurred in the course of employment.

Respondeat Superior

A legal principle that assigns legal liability to an employer or principal for the misconduct of an employee or agent when those actions are carried out in the course of their employment or representation.