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If an Import-Competing Firm Is the Only Domestic Producer of a Good

Question 12

Multiple Choice

If an import-competing firm is the only domestic producer of a good, then a transition from autarky to free trade will ________ domestic price, ________ producer surplus, ________ consumer surplus, and ________ overall domestic national welfare.


A) increase; increase; increase; increase
B) decrease; decrease; decrease; decrease
C) decrease; decrease; increase; increase
D) increase; increase; decrease; decrease
E) increase; increase; decrease; increase

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