The Following Graph Shows the Demand for and the Supply

question 142

Multiple Choice

The following graph shows the demand for and the supply of a good in a country.If the world price of the good is $2.00 per unit and an import quota of 50 units per month is imposed,then:​ ​
Figure 17.6
​

• A)domestic production will increase from 100 to 200 units per month.
• B)imports will increase from 25 to 50 units per month.
• C)domestic production will increase from 100 to 175 units per month.
• D)domestic production will increase from 100 to 125 units per month.
• E)domestic production will increase from 100 to 150 units per month.

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Definitions:

Poisson Approximation

A mathematical method for estimating the likelihood of a certain number of occurrences taking place within a set time period.

Uniform Density

A type of distribution in which all outcomes are equally likely within a specified range, characterized by a constant probability density function.

Probability

A measure of the likelihood that a particular event will occur, expressed as a number between 0 and 1.

Poisson Approximation

A statistical method used to approximate the probabilities of rare events in a fixed interval of time or space, assuming events occur with a known constant rate independently of the time since the last event.