-Refer to Exhibit 34-2

question 59

Multiple Choice

-Refer to Exhibit 34-2.The U.S.demand and supply for a good are shown.Under a policy of free trade,the world price is P_W.If there is a policy change such that imports are prohibited,the price becomes P_N, U.S.consumers are worse off if imports are __________; specifically,their consumers' surplus changes by area __________.

• A) prohibited; P_WABD
• B) permitted; P_WDE
• C) prohibited; P_NBCP_W
• D) permitted; P_N BDP_W
• E) none of the above

---

Definitions:

Inventory

The raw materials, work-in-progress products, and finished goods that are considered to be the portion of a business's assets that are ready or will be ready for sale.

Corporate Strategy

The overarching strategy of a company, focusing on overall direction, resource allocation, and long-term objectives.

Allocate Resources

The process of distributing available resources, such as funds, materials, and labor, among various projects or departments to achieve organizational goals.

Globalization

The process by which businesses or other organizations develop international influence or start operating on an international scale.