Chart 1 below illustrates the tennis shoe market in Canada. 5-1- If Canada did not trade with other countries in this market, then what would be the equilibrium price and quantity in the Canadian tennis shoe market? The price of tennis shoes in the world market is $ 15. Suppose Canada opens up to free trade with other countries. 5-2- What would then be the quantity demanded, the quantity supplied, the quantity imported into the Canadian market on the world market? 5-3- Calculate and graphically represent the variation in social surplus brought about by opening up to free trade.

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