Suppose Country a and Country B Are the Only Two

Multiple Choice

Suppose country A and country B are the only two countries in the world. Country A imports good X from country B and exports good Y. In the absence of any transportation cost, at the world price of good X:

A) country B's export supply curve is perfectly inelastic.
B) both country A's import demand curve and country B's export supply curve are positively sloped.
C) country A's import demand curve will be perfectly inelastic.
D) country A's import demand curve will intersect country B's export supply curve.