In free-trade countries such as the United States, if there is a coal-supply disturbance which increases international coal prices, domestic coal prices will also be affected whether such free-trade countries import some or none of their coal.
Which of the following conclusions is best supported by the argument?
A. When there is a disturbance in the international coal supply, free-trade countries’ domestic coal producers
cannot participate in international coal markets. -
incorrectWe cannot conclude that free-trade countries’ domestic coal producers are unable to participate in international coal markets
B. As long as a free-trade country has sufficient domestic supply to meet domestic demand, domestic coal prices are
barely affected, if at all, by international coal-supply disturbances. -
incorrectArgument clearly states that domestic coal prices will also be affected.
C.
Even if a free-trade country usually sells most of its domestically produced coal within its borders, that country remains part of the international market for coal. -
CorrectIt can be concluded since free trade countries can still access international markets and hence will remain a part of the international market.
D. Even if international coal prices spike, free-trade countries that export little or no domestically produced coal can
keep domestic coal prices constant. -
incorrectIt is clearly stated that domestic coal prices will also be affected whether such free-trade countries import some or none of their coal. We cannot conclude that
free-trade countries can keep domestic coal prices constant.
E. When there is a disturbance in the international coal supply,
non-free-trade countries’ domestic coal producers are affected by international coal markets. -
incorrectThe argument doesn't give any information about non-free-trade countries.