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The country of Sabora currently bans all international trade. Sabora makes high-quality spears and is currently producing as many spears as the local population wishes
The country of Sabora currently bans all international trade. Sabora makes high-quality spears and is currently producing as many spears as the local population wishes to buy at $50 each. Other countries currently produce and sell spears at $125 each. The newly elected president of Sabora decides to allow international trade for the first time in Sabora's existence. They will begin trade next year. Saboran spear-makers will happily engage in trade. Assume there is free trade, and that Sabora will sell all the spears they make. Note that not all statements will be used. What will happen to the quantity and price of Sabora's spears next year? Answer Bank Sabora's supply curve will shift to the right. A greater quantity of Sabora's spears are supplied at the same price. There will be movement along Sabora's supply curve. A greater quantity of Sabora's spears are supplied at a higher price. Sabora's spear prices are lower for the same quantity. Sabora's supply curve will shift to the left
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