Restrictions on the importation of tomatoes reduce the supply available to the U.S. domestic market. Studies indicate that the demand for tomatoes is elastic. Compared to a free-trade situation, the import restrictions cause
a. higher tomato prices and an increase in consumer expenditures on tomatoes in the United States.
b. lower tomato prices and an increase in consumer expenditure on tomatoes in the United States.
c. lower tomato prices and a reduction in consumer expenditure on tomatoes in the United States.
d. higher tomato prices and a reduction in consumer expenditure on tomatoes in the United States.
d
Economics
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a. is the vertical summation of the AFC and the AVC curves. b. lies below the AVC curve. c. lies below the AFC curve. d. is the vertical summation of the MC and AVC curves.
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