The above figure shows the U.S. market for 1 carat diamonds. With free trade, U.S. production of diamonds is equal to ________ diamonds. When the quota illustrated in the figure is in place, U.S. production is equal to ________ diamonds
A) 300,000; 100,000
B) 100,000; 500,000
C) 300,000; 500,000
D) 100,000; 300,000
E) 900,000; 700,000
D
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The existence of a kinked demand curve under oligopoly conditions may result in
a. volatile prices b. competitive pricing. c. prices above the monopoly price. d. an increase in the coefficient of variation of prices. e. stable prices
How could Adam Smith's comment about the butcher, the brewer, and the baker be accurately rephrased in modern terms?
A) The butcher, the brewer, and the baker give us our dinner because they want to be well liked in the community. B) The butcher, the brewer, and the baker give us our dinner because they will be sued if they don't do so. C) The butcher, the brewer, and the baker give us our dinner because they each earn a living by doing so. D) The butcher, the brewer, and the baker give us our dinner because they view doing so as a public service.