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exports/ imports

The diagram below depicts the supply and demand curves for bicycles.  Use the diagram to answer the following questions 1 to 6.

          

     


3. The economy transitions from no trade to free trade and the new international equilibrium price for a bicycle is $40.  Does this economy export or import bicycles? How many? 



a.

Imports 100 bicycles.

b.

Imports 200 bicycles.

c.

Exports 100 bicycles.

d.

Exports 200 bicycles.



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