Suppose the relative price of good A before trade is equal to one in the home country and two in the foreign country. If the home country is a large country and the foreign country is a small country, then the relative price of good A after trade will be equal to a.less than one b.greater than one but less than 1.5 c.1.5 d.greater than 1.5 but less than 2

Exploring Economics
8th Edition
ISBN:9781544336329
Author:Robert L. Sexton
Publisher:Robert L. Sexton
Chapter28: International Trade
Section: Chapter Questions
Problem 15P
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Suppose the relative price of good A before trade is equal to one in the home country and two in the foreign country. If the home country is a large country and the foreign country is a small country, then the relative price of good A after trade will be equal to

a.less than one

b.greater than one but less than 1.5

c.1.5

d.greater than 1.5 but less than 2

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