The Figure Below Shows the Demand (D) and Supply (S)

question 85

Multiple Choice

The figure below shows the demand (D) and supply (S) curves of a good produced domestically in an economy as well as traded in the international market.Figure 21.1
In the figure,
P₁: Price of the good in the international market.P₂: Price of the good in the domestic market after the imposition of tariff by the government.P₃: No-trade price of the good in the domestic market.
-If the world price of a good is lower than its domestic equilibrium price, the country will:

• A)import a quantity of the good equal to the difference between the quantity demanded domestically and the quantity supplied domestically.
• B)export a quantity of the good equal to the difference between the quantity demanded domestically and the quantity supplied domestically.
• C)import a quantity of the good equal to the difference between the quantity demanded domestically and the quantity supplied by foreign producers.
• D)export a quantity of the good equal to the difference between the quantity demanded by foreign consumers and the quantity supplied domestically.
• E)import a quantity of the good equal to the difference between the quantity demanded by foreign consumers and the quantity supplied by foreign producers.

Understand the concept and implications of the bystander effect.

Identify and explain basic features of group polarization and groupthink.

Recognize the primary features and structures within groups, including power and communication structures.

Explain the concept of group cohesiveness and its implications for group dynamics.

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Definitions:

Law of Demand

The law of demand states that, all else being equal, as the price of a good or service increases, consumer demand for the good or service will decrease, and vice versa.

Quantity Demanded

The complete volume of a particular good or service that purchasers are both eager and financially able to acquire at a certain price within a market.

Price Increases

Situations where the cost of goods or services rise, often reflecting inflation or increased production costs.

Cancer-Causing Particles

Substances or elements that, upon exposure, increase the risk of developing cancer in living tissues.