The Demand for Cars in a Certain Country Is Given

question 74

Multiple Choice

The demand for cars in a certain country is given by: D = 20,000 - P, where P is the price of a car. Supply by domestic car producers is: S = 5,000 + 0.5P.If this economy is open to trade, and the world price of a car is $6,000, the domestic quantity demanded will be ________ and quantity supplied will be ________.

• A)14,000; 8,000
• B)12,000; 8,000
• C)12,000; 10,000
• D)8,000; 14,000

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Definitions:

Demand for Pesos

The desire or need by individuals, businesses, or countries to obtain Mexican Pesos, often influenced by factors like investment opportunities, trade balances, and economic conditions in Mexico.

Flexible Exchange Market

A currency exchange system where exchange rates fluctuate in response to the foreign exchange market's demand and supply.

Appreciate the Dollar

A term referring to the increase in value of the U.S. dollar relative to other currencies.

Flexible Exchange Market

A type of foreign exchange market where exchange rates can fluctuate in response to market forces without direct government intervention.