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Question The attached graph depicts the import market for Mexico who has decided to join a FTA with the United States. Assume Mexico is a small nation in international trade. What is the volume of trade creation? (j stands for Japan) a. 20 unit b. 30 unit c. 40 unit d. 50 unit e. 60 unit Based on the graph, what is the volume of trade that is diverted? a. 10 units b. 20 units c. 30 units d. 40 units e. 602 units Based on the graph, how is Mexico’s economic well-being impacted by joining the FTA with the United States? a. +$200 b. -$120 c. -$80 d. +$60 e. +$40

Question

The attached graph depicts the import market for Mexico who has decided to join a FTA with the United States.

Assume Mexico is a small nation in international trade. What is the volume of trade creation? (j stands for Japan) a. 20 unit b. 30 unit c. 40 unit d. 50 unit e. 60 unit Based on the graph, what is the volume of trade that is diverted? a. 10 units b. 20 units c. 30 units d. 40 units e. 602 units Based on the graph, how is Mexico’s economic well-being impacted by joining the FTA with the United States? a. +$200 b. -$120 c. -$80 d. +$60 e. +$40

 
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