Question

Trade restricted country, unfortunately, your purchase couldn't be completed because of trade restrictions on the country you're in.

a) True
b) False

Answer 1

If trade is allowed to occur between two countries, the equilibrium price and quantity will be determined by the forces of supply and demand in each country.

Step-by-step explanation:

If trade is allowed to occur between two countries, the equilibrium price and quantity will be determined by the forces of supply and demand in each country. In a free trade scenario, where trade barriers such as tariffs and restrictions are removed, the price and quantity in each country will be determined by the global market.

For example, if Country A and Country B engage in trade and both have a demand for a certain product, the global price of that product will be determined by the combined demand and supply from both countries. The equilibrium price and quantity in each country will then be influenced by their respective demand and supply levels.

By observing the global market and understanding the demand and supply factors in each country, economists can make predictions about the equilibrium price and quantity that would result if trade were allowed to occur.