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Consider a two - country world, Zambia and DRC . Each country has an upward - sloping national supply curve for soyabeans and a downward

Consider a two-country world, Zambia and DRC. Each country has an upward-sloping national supply curve for soyabeans and a downward-sloping national demand curve for soyabeans. With no trade in soyabean, the no-trade equilibrium price for soyabeans in Zambia would be $2.00 per kilogram and the no-trade equilibrium price for soyabeans in the DRC would be $3.20 per kilogram. If the countries allow free trade in soyabeans, explain why $3.50 per kilogram cannot be the free-trade equilibrium world price for soyabeans. In your answer, draw and refer to graphs of supply and demand curves for the two national markets.

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