If the Japanese government offers its companies a $15 subsidy for every radio exported to Mexico, what will be the resulting price of radios in Mexico and the quantity of imports?

Show Answers

Radios in Mexico cost $60 each, with 30 units importedRadios in Mexico cost $30 each, and 30 units are importedRadios in Mexico cost $40 each, and 20 units are importedRadios in Mexico cost $20 each, with 40 units imported

Explanation

When the Japanese government subsidizes exports by $15 per radio, the price in Mexico decreases to $30, encouraging imports of 30 radios. This subsidy effectively lowers the cost for consumers, leading to increased imports at the new price point.