In 2007, European Union (EU) negotiators have offered to cut ...

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In 2007, European Union (EU) negotiators have offered to cut tariffs for Latin American bananas to avoid banana wars. What are the effects of a cut in tariffs?
 
  A) The quantity of bananas imported into the EU will increase.
  B) The price of bananas for consumers will increase.
  C) The quantity of bananas produced in the EU (such as in France and Spain) will increase.
  D) Europe will start to export bananas.

Question 2

Given the total cost and total revenue curves in the above figure, what are the output levels at which the perfect competitor will incur economic losses?
 
  A) below 80,000 bushels
  B) from 30,000 to 80,000 bushels
  C) below 30,000 bushels and over 80,000 bushels
  D) at 30,000 bushels and at 80,000 bushels

[jointhecircus]

Answer to Question 1

A

Answer to Question 2

C

[plus1]

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[Liamb2179]

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