In which type of market would it be most difficult to buy goods from another country?

• A. Monopolistic competition
• B. Perfectly competitive market
• C. Closed economy
• D. Open economy

Answer: (C)

Verified step by step guidance

1. Step 1: Understand the key terms. A 'closed economy' is one that does not engage in international trade, meaning it does not buy or sell goods from or to other countries. An 'open economy' participates in international trade.
2. Step 2: Recognize the types of markets mentioned: 'monopolistic competition' and 'perfectly competitive market' describe market structures based on the number of firms and product differentiation, but they do not directly determine whether a country trades internationally.
3. Step 3: Analyze the question: It asks in which type of market it would be most difficult to buy goods from another country. Since a closed economy does not engage in international trade, it would be the most difficult to buy foreign goods there.
4. Step 4: Contrast with an open economy, where buying goods from other countries is possible and encouraged, making it easier to access foreign goods.
5. Step 5: Conclude that the difficulty in buying goods from another country is primarily related to whether the economy is open or closed, not the market structure within the country.