anonymous
  • anonymous
In Problem Set 1, question 1d solutions do agree with me that the supply curve shifts to the right in the Chinese textile market. However, I do not agree that the equilibrium price will be higher. How can this be (considering the intersection point will always be lower in terms of y-value)?
OCW Scholar - Principles of Microeconomics
  • Stacey Warren - Expert brainly.com
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SOLVED
At vero eos et accusamus et iusto odio dignissimos ducimus qui blanditiis praesentium voluptatum deleniti atque corrupti quos dolores et quas molestias excepturi sint occaecati cupiditate non provident, similique sunt in culpa qui officia deserunt mollitia animi, id est laborum et dolorum fuga. Et harum quidem rerum facilis est et expedita distinctio. Nam libero tempore, cum soluta nobis est eligendi optio cumque nihil impedit quo minus id quod maxime placeat facere possimus, omnis voluptas assumenda est, omnis dolor repellendus. Itaque earum rerum hic tenetur a sapiente delectus, ut aut reiciendis voluptatibus maiores alias consequatur aut perferendis doloribus asperiores repellat.
katieb
  • katieb
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anonymous
  • anonymous
In 1d - Mexican Workers go on Strike -> Cost of Production of textile in Mexico Increases -> therefore, It's supply decreases (Shifts to the left) & price Increases. -> Therefore, Mexican Textiles demand decreases. -> as China Textiles Products are MT's substitutes, CT's demand Increases. (Shifts to right) -> As a result, Equilibrium price of Chinese Textiles Increases.

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