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Question 14 1 pts Suppose that there are two countries named Pawnee and Eagleton. Both countries have a large consumer market for bikes and a

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Question 14 1 pts Suppose that there are two countries named Pawnee and Eagleton. Both countries have a large consumer market for bikes and a number of bike sellers serving the market in each country. Assume that each bike seller offers a unique variety of bikes and sells it at a price that equals the seller's average cost of production. Assume also that bikes are produced with increasing returns to scale. When trade begins between Pawnee and Eagleton, the Imperfect Competition Model of trade would predict that average total costs of production would __________ and short-run prots " increase; zero " decrease; positive " increase; positive decrease; negative ' Question 15 1 pts After the opening of trade between the bike markets of Pawnee ancl Eagleton described in the previous question, which of the following statements best describes the outcome predicted by the Imperfect Competition model? The price of a bike would increase in Pawnee and decrease in Eagleton. The price of a bike would increase and the variety of bikes available would increase in both countries. The price of a bike would decrease and the variety of bikes available would increase in both countries. The bike market would become monopolized, decreasing variety and raising prices

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