Deardorff, Alan V. (contributor); … - 2005
. The country is small
and faces a fixed world price, P
W
, of its export, which it supplies with the supply curve
S
X …
. If it were able to export to the world market directly under perfect competition, it
would export the quantity X
C … the country’s export at the
quantity that equates this marginal cost to the world price, X
M
. By doing so it pushes …