Question

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Read the following news article by Tim Johnson:
The nature of global trade is about to change. The Panama Canal will soon have a third lane that can accommodate mega-ships nearly three times larger than any vessel that has ever transited the isthmus over the past century. It might not seem like earth-shaking news. But the impact will ripple around the world, from shipyards in South Korea to highways in Texas to coalfields in Colombia and soy plantations in Brazil’s northeast. Entire nations will see trade patterns shift.
The expanding of the Panama Canal will have what economic impact on world trade and its consumers?

prices will drop

prices will rise

have fewer goods.

demand will increase

Answer 1

prices will drop

Explanation: Allowing much larger, more efficient ships increases shipping capacity and lowers per-unit transport costs. That reduces costs for importers and producers, which tends to lower consumer prices and expand trade (not reduce goods or directly raise demand).