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Gwar [14]
3 years ago
10

Suppose portable radios can be imported at a world price of $10 per radio. If trade were unencumbered, what would the new market

equilibrium be? How many portable radios would be produced domestically? How many portable radios would be imported?
Business
1 answer:
Harman [31]3 years ago
6 0

Answer:

Domestic demand: Q = 5,000 – 100P; Supply: Q = 150P

At equilibrium, demand equals supply.

5,000 – 100P = 150P

250P = 5,000

P = 5,000/250

Equilibrium price (P) = $20

Substituting P in demand equation:

Q = 5,000 – (100*20)

Equilibrium quantity (Q) = 3,000 portable radio would be imported

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