If a country imports a small fraction of the worlds supply w

If a country imports a small fraction of the world\'s supply we expect it to face A. a nearly perfect elastic, horizonal residual supply curve. B. The type of supply curve it faces connot be determined. C. a nearly perfectly inelastic, vertical residual supply curve. D an upward sloping residual supply curve.

Solution

If a country imports smaller share of world\'s supply,then we expect that it faces a nearly perfect elastic, horizontal residual supply curve.

An importing country\'s supply is the sum of its own and import supply curves.

Residual supply curve shows the quantity that world supplies that is not consumed by other demanders at any given price.