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    Question

    Within a country, the domestic price of a product will equal the world price if

    A trade restrictions are imposed on the product Correct Answer Incorrect Answer
    B the country chooses to import, but not export, the product Correct Answer Incorrect Answer
    C the country chooses to export, but not import, the product Correct Answer Incorrect Answer
    D the country does not allow free trade Correct Answer Incorrect Answer
    E the country allows free trade Correct Answer Incorrect Answer

    Solution

    In case of free trade, domestic price equals world price of a product.

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