Multiple Choice
Without trade the price of one unit of product Y is 1/3 that of one unit of X in a small country.
Products X and Y trade on the world market at equal prices.If the small country starts trading with the rest of the world:
A) the small country would import product Y.
B) the small country would export both product X and product Y.
C) the domestic price of product X would equal the world price.
D) the relative price of X and Y would not change in the small country.
Correct Answer:
Verified
Correct Answer:
Verified
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