The United States China India Brazil And Turkey Are Forming An International Ass

2. The United States, China, India, Brazil, and Turkey are forming an international association known as Tobacco’s Altruistic Raisers (TAR) to increase the world price of tobacco. TAR’s members control 60 percent of world tobacco production. The price elasticity of world demand for tobacco is rather low in the short run but somewhat higher in the long run. The ability of other countries who are not TAR members to increase their production of tobacco is very small for a period of several years; but, with a few years to prepare, other countries could easily expand their tobacco production. You are asked to put a report on the outlook for TAR’s success. What will you say in the report?

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