. [A nation] is “small”, unable to affect world prices. It imports peanuts at the price of $10 per bag. The demand curve is D=800-20PThe supply curve is S=100+10PDetermine the free trade equilibrium. Then calculate and graph the following effects of an import quota that limits imports to 100 bags.
[A nation] is “small”, unable to affect world prices. It imports peanuts at the price of $10 per bag.
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