Scenario 9-2 • for a Small Country Called Boxland,the Equation of the of the Domestic

question 282

Multiple Choice

Scenario 9-2
• For a small country called Boxland,the equation of the domestic demand curve for
cardboard is ,
where represents the domestic quantity of cardboard demanded,in tons,and represents the price of a ton of cardboard.
• For Boxland,the equation of the domestic supply curve for cardboard is ,
where represents the domestic quantity of cardboard supplied,in tons,and again
represents the price of a ton of cardboard.
-Refer to Scenario 9-2.Suppose the world price of cardboard is $45.Then,if Boxland goes from prohibiting international trade in cardboard to allowing international trade in cardboard,

• A)domestic producers of cardboard become better off and domestic consumers of cardboard become better off.
• B)domestic producers of cardboard become better off and domestic consumers of cardboard become worse off.
• C)domestic producers of cardboard become worse off and domestic consumers of cardboard become better off.
• D)domestic producers of cardboard become worse off and domestic consumers of cardboard become worse off.

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Definitions:

Mortality Rate

Mortality rate, often expressed per thousand or per hundred thousand, refers to the frequency of deaths in a given population during a specific period of time.

Unrecognized Net Gain Or Loss

Refers to gains or losses that have been incurred but are not reported in the financial statements because they are unrealized.

Vested Benefits

Employee benefits, such as pension plans or stock options, that one has earned the right to receive and cannot be forfeited.

Accrual Concept

An accounting methodology that records revenues and expenses when they are incurred, regardless of cash flow.