Answer: 5. If Canada begins to export furniture, it is because the domestic price of furniture: A) decline, leading to a decrease in production; imports fill the gap. B) rises, leading to a reduction in demand, the difference being exported. C) remains the same, but Canada is increasing its furniture production to meet global demand. D) rises, demand falls, production increases and the surplus is exported. E) rises, demand increases and imports fill the gap.
Answer: 5. If Canada begins to export furniture, it is because the domestic price of furniture: A) decline, leading to a decrease in production; imports fill the gap. B) rises, leading to a reduction in demand, the difference being exported. C) remains the same, but Canada is increasing its furniture production to meet global demand. D) rises, demand falls, production increases and the surplus is exported. E) rises, demand increases and imports fill the gap.
Microeconomics: Private and Public Choice (MindTap Course List)
16th Edition
ISBN:9781305506893
Author:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Publisher:James D. Gwartney, Richard L. Stroup, Russell S. Sobel, David A. Macpherson
Chapter16: Gaining From International Trade
Section: Chapter Questions
Problem 16CQ
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