In year 1 the price of good X is $10 and 100 units are bought and sold. In year 2 the price of good X is $13 and 230 units are bought and sold. What can explain this?
A) The supply of good X was higher in year 2 than in year 1 and the demand for good X was the same in year 2 as in year 1.
B) The demand for good X was higher in year 2 than in year 1 and the supply of good X was the same in year 2 as in year 1.
C) Both the demand for, and supply of, good X were higher in year 2 than in year 1.
D) b or c
E) a, b, or c
D
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Which of the following situations is least likely to involve strategic interaction?
A) two countries deciding whether to impose trade restrictions on each other B) competing convenience stores deciding how much to charge for coffee C) two customers deciding which toaster to buy from Target D) a state legislature deciding whether to legalize casino gambling
The increase in welfare in both countries that results from specialization and trade is called:
A. deadweight gain. B. exportation surplus. C. gains from trade. D. surplus enhancement.