Country X enters into a customs union with country Y. X then stops making its own cars and starts bringing in cars from Y. Country Y redirects some of its car exports to X away from country Z. What effect is this likely to have on car prices in X and Z?
- Acountry X: decrease; country Z: decrease
- Bcountry X: decrease; country Z: increase
- Ccountry X: increase; country Z: decrease
- Dcountry X: increase; country Z: increase