Question

Use the following graph to answer the next six questions. 22,000 20,000 Domestic supply 18,000 16,000 Price 14,000 of 12,000 cars 10,000 ($) 8,000 6,000 4,000 2,000 World price Domestic demand 10 20 30 40 50 60 70 80 90 100 Quantity of cars (thousands) If this economy trades with other countries, what will the price of a car be in this open economy? $6,000 $14,000 $8,000 $24,000 $10,000

          Use the following graph to answer the next six questions.
22,000
20,000
Domestic
supply
18,000
16,000
Price 14,000
of 12,000
cars 10,000
($) 8,000
6,000
4,000
2,000
World price
Domestic
demand
10 20 30 40 50 60 70 80 90 100
Quantity of cars (thousands)
If this economy trades with other countries, what will the price of a car be in this
open economy?
$6,000
$14,000
$8,000
$24,000
$10,000

Use the following graph to answer the next six questions.
22,000
20,000
Domestic
supply
18,000
16,000
Price 14,000
of 12,000
cars 10,000
() 8,000
6,000
4,000
2,000
World price
Domestic
demand
10 20 30 40 50 60 70 80 90 100
Quantity of cars (thousands)
If this economy trades with other countries, what will the price of a car be in this
open economy?6,000
14,0008,000
24,00010,000

Added by Sarah C.

Principles of Economics

Gregory Mankiw 8th Edition

Instant Answer

Solved by Expert Lottie Adams

Step 1

The equilibrium price is where the domestic supply and demand curves intersect. In this case, it is at a price of $10,000 and a quantity of 10,000 cars. Show more…

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Use the following graph to answer the next six questions. 22,000 Domestic supply 20,000 18,000 16,000 Price 14,000 of 12,000 cars 10,000 ($) World price 8,000 6,000 4,000 Domestic demand 2,000 102030405060708090 100 Quantity of cars (thousands) If this economy trades with other countries, what will the price of a car be in this open economy? $6,000 $14,000 $8,000 $24,000 $10,000