Question

Computer game cartridges produced in EconomyLand sell for $50 each. The same cartridges made in MarketLand sell for $100 each. If free trade were allowed, we would expect the prices in both countries to a. move to the lower price of $50. b. move to the higher price of $100. c. converge to somewhere between $50 and $100. d. remain unchanged.

Answer 1

Converge to somewhere between $50 and $100.

Step-by-step explanation:

Based on the information given in a situation where free trade were allowed, we would expect the prices in both countries to CONVERGE TO SOMEWHERE BETWEEN $50 and $100 reason been that we were told that the Computer game cartridges that was produced in EconomyLand sell for the amount of $50 each while on the other hand The same cartridges made in MarketLand also sell for the amount of $100 each