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Determine world price in this model

KTEE216
International Economics 1
Basic Trade Model using
Demand-Supply
By Asoc. Prof. Tu Thuy Anh
Faculty of International Economics

International Free-trade Equilibrium


Excess demand – Excess supply

Husted/Melvin, © 2001, Addison Wesley Longman, Inc. All rights reserved.

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Welfare analysis
Who gains? Who loses?

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