Suppose That Norway Is a Small Country and Currently Produces

question 54

Multiple Choice

Suppose that Norway is a small country and currently produces 100,000 board feet of lumber at $600 per 1,000 board feet. Then it begins to trade at the world price of $500 per 1,000 board feet. As a result of trade, Norway's production falls to 50,000 board feet and its consumption increases to 200,000 board feet. What is Norway's total welfare gain once it begins to trade?

• A) $5,000
• B) $7,500
• C) $15,000
• D) $17,500

---

Definitions:

Desiccation

The process of drying out or dehydrating, often leading to extreme dryness.

Metabolic Cost

The energy expenditure required to maintain bodily functions and activities, including growth, reproduction, and survival mechanisms.

Kinetic Limitations

Restrictions in the rate of a physical or chemical process, caused by the reaction speed, which affects the overall system’s efficiency.

Anterior Air Sacs

Air-filled spaces located in the forward part of an avian respiratory system that facilitate gas exchange.