This Graph Demonstrates the Domestic Demand and Supply for a Good,as

question 47

Multiple Choice

This graph demonstrates the domestic demand and supply for a good,as well as a tariff and the world price for that good.
According to the graph shown,if the economy was operating under autarky,and decides to open trade with a tariff,the impact on domestic supply is:

• A)they will increase output from 250 to 500.
• B)they will decrease output from 815 to 500.
• C)they will increase output from 500 to 815.
• D)they will decrease output from 1500 to 1150.

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Definitions:

Mental

Pertaining to the mind or to mental states, processes, and faculties.

Nature

The physical world and everything in it that is not made by human beings, including plants, animals, and landscapes.

Invisible Hand

A term coined by Adam Smith to describe the self-regulating nature of the marketplace, where individuals' pursuit of their own self-interest often leads to beneficial effects for the society as a whole.

Adam Smith

An 18th-century Scottish economist and philosopher, best known for his works "The Wealth of Nations," which is considered the foundation of modern economic theory.